Tesla Aims To Speed Up Deliveries of 2016 Tesla Model X | Edmunds

Tesla Aims To Speed Up Deliveries of 2016 Tesla Model X


PALO ALTO, California Tesla Motors is taking steps to speed up deliveries of the 2016 Tesla Model X all-electric SUV, the automaker said in its third quarter shareholder letter on Tuesday.

Tesla CEO Elon Musk and CFO Deepak Ahuja said the biggest factor hampering deliveries of the Model X is the supply of components for the SUV's second-row seats.

"To eliminate these supply constraints and achieve a better overall outcome, we have brought manufacturing of these seats in-house," they wrote. "In addition, we and some of our other Model X suppliers are still ramping up and fine-tuning production. These factors add uncertainty to our build plans during Q4, but we feel emphasizing quality is the right decision for our customers."

The second-row seats move independently on tracks to give occupants easier access to the third row.

Tesla said it expects average production and deliveries of 1,600 to 1,800 vehicles per week for the Model S sedan and Model X combined during 2016.

"We expect our average vehicle sales price to increase slightly in Q4 with more deliveries of highly optioned Model X vehicles," the letter said.

It also noted that Tesla plans to launch a "lower-priced version of Model X with a smaller battery pack during 2016."

Pricing on that version was not announced.

The Model X debuted on September 29, targeting the BMW X6, Porsche Cayenne and Land Rover Range Rover Sport.

"Since the Model X launch event, order rates have accelerated for both Model S and Model X," the letter said. "Although it is too early to draw firm conclusions, this supports our belief that Model X expands the market for Tesla vehicles, with little to no cannibalization of Model S."

Tesla delivered a record 11,603 new vehicles in the third quarter. In the fourth quarter, it plans to build 15,000-17,000 vehicles, which will result in 50,000-52,000 total deliveries for the year, down slightly from its mid-year forecast.

Tesla also said it is on track to unveil the mass-market Tesla Model 3 electric car, which competes with the BMW 3 Series, in late March 2016. The target price on the Model 3 is $35,000.

Edmunds says: Car shoppers who are anxious to get their hands on the Tesla Model X get some reassuring words from company officials.

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