Tesla said it delivered approximately 76,230 vehicles in 2016, falling short of the 80,000 vehicle projection it set for the year in its fourth-quarter earnings report at the beginning of the year.
It’s a slight miss, and it doesn’t seem like one that’s made Wall Street all that upset. The company in October reported that it had made a profit in the third quarter, saying it still planned to ship around 50,000 in the second half of the year. So it seems like that projection may have been a little aggressive, though not tragically so. Shares of Tesla are down around 2%.
“Our Q4 delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct,” the company said in its announcement.
So, there’s some nuance here. While it still missed its targets, Tesla cited production challenges through the quarter “from the transition of the new Autopilot hardware.” That led to production happening more heavily toward the end of the quarter, Tesla said. Adding to that note, 6,450 vehicles were in transit at the end of the quarter, which will be counted in its Q1 deliveries, the company said.
“We were ultimately able to recover and hit our production goal, but the delay in production resulted in challenges that impacted quarterly deliveries, including, among other things, cars missing shipping cutoffs for Europe and Asia,” the company said. “Although we tried to recover these deliveries and expedite others by the end of the quarter, time ran out before we could deliver all customer cars. In total, about 2,750 vehicles missed being counted as deliveries in Q4 either due to last-minute delays in transport or because the customer was unable to physically take delivery. Even where these customers had already fully paid for their vehicle, we still did not count these as deliveries in Q4.”
The company has been very aggressive in getting its autopilot technology out into the world. Tesla started rolling out updated autopilot software for Tesla owners (though not widely just yet) yesterday. In a race to develop fully autonomous vehicles, Tesla has made it clear that it wants to get the tech in the hands of consumers early and use that as a major selling point for its cars.
Tesla expected 25,000 of those deliveries to come in the fourth quarter this year. The company ended up delivering 22,000 in the fourth quarter, with 12,700 Model S cars and 9,500 Model X cars delivered. The company said it produced 24,882 vehicles in Q4 with a total production of 83,922 vehicles in 2016. There’s a distinction to be made between deliveries and production, and in the end it seems like Tesla might have been a bit aggressive in its projections given the challenges it faces as a company.