Tesla customers in China can look forward to shorter delivery times

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• Tesla reduces delivery times in China
• Tens of thousands of deliveries projected for September
• Reference to falling demand raises hopes of price cuts

Tesla fans in China can rejoice. Within just one month, the carmaker, under the leadership of Jack of all trades Elon Musk have now been able to reduce the forecast delivery times for various Tesla models three times. As the relevant industry portal InsideEVs found with regard to Tesla’s Chinese website, there were shorter waiting times for delivery for the Tesla Model 3 and Tesla Model Y models with different equipment. While the Model 3 was previously given a delivery time range of six to ten weeks, buyers now only have to wait one to eight weeks or ten for the performance model. For the Model Y, the drop was sometimes even more significant in terms of delivery times: while the Model Y Long Range previously took ten to 14 weeks to arrive, it can now be delivered after just one to ten weeks. The Tesla Model Y Performance can now be delivered after one to ten weeks, previously the range was six to ten weeks. However, the reduction in delivery times seems even more impressive, considering that the range in 2022 was sometimes even given as 12 to 16 and 16 to 20 weeks.

Gigafactory Shanghai upgraded

But what is behind these delivery time reductions? According to InsideEVS, one reason may be that the Chinese gigafactory in Shanghai has just received a major upgrade, with the Model 3 and Y product lines in particular being improved. This had already led to a large increase in production in August. In addition, the Chinese EV market is one of the most important for Tesla. Because of the low transport costs of the locally manufactured vehicles, the car manufacturer in the People’s Republic can look forward to a higher margin.

Apparently 80,000 to 90,000 deliveries are estimated in September

According to the news portal jiuyangongshe.com, the US vehicle manufacturer is targeting deliveries of 80,000 to 90,000 electric vehicles from Shanghai for September. So far, June has been the best month for the gigafactory with 78,906 vehicles delivered, with the majority remaining in China. As Teslarati suspects with reference to media reports, the shorter delivery times could also be an attempt to thwart private dealers of Teslas. In the past, it was a business model for many to book vehicles early and sell them on at a later date for a large profit. This was attractive to buyers because it gave them access to the desired vehicles more quickly. Now with faster deliveries, however, it’s less worth looking outside of official Tesla retail locations.

Is demand falling?

However, the reduced delivery times don’t have to be all good news for the US automaker. According to InsideEVs, it would also be worth taking a look at the demand side. It is also possible that local demand will weaken or that exports to Europe will decline, which would also make sense given the new gigafactory in Berlin. If demand actually falls, price cuts are not unrealistic, according to the news portal. This assumption is supported by the fact that Tesla boss Elon Musk has already shown himself annoyed by the numerous price increases that have been carried out recently: “We have raised our prices quite often. They are now at a level that Honestly, it’s embarrassing. But we’ve also had a lot of problems with supply chains and manufacturing and inflation is abnormally high,” Musk said as part of the earnings call for the second quarter of 2022.

Piper Sandler estimates that Tesla should extend the lead

As Piper Sandler analyst Alexander Potter explains in a customer story obtained by StreetInsider, Tesla’s competitors should brace themselves in the face of faster delivery times: “As production ramps up and wait times decrease, we believe Tesla continues to uniquely will be able to quickly meet consumer demand for electric vehicles at affordable prices.While other brands are struggling to ramp up production, Tesla will (presumably) start lowering prices, thereby gaining market share at the expense of everyone else increase.” However, investors should not get used to the currently high margins, as these would decrease again as a result of price reductions. Nevertheless, the expert summarizes: “If Tesla’s upstream supply bottlenecks really resolve, we think these are scary prospects for other brands.”

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