Nov 27, 2021
Elon Musk urges Tesla employees to reduce cost of vehicle deliveries
This news has been received from: CNBC
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Tesla's Model Y compact crossover vehicles at a showroom in Shanghai, China, on January 18, 2021.VCG | Visual China Group | Getty Images
Amid ongoing port constraints and rising shipping costs, Tesla CEO Elon Musk urged employees Friday, in a company-wide email obtained by CNBC, to look for ways to reduce the cost of delivering electric vehicles to customers, rather than rushing orders out last-minute to hit its end of quarter sales goals.
This year, Tesla has struggled to deliver new cars to customers in the U.S. in line with originally promised date ranges. As CNBC previously reported, some Tesla customers here experienced delivery delays of months, leaving them paying out of pocket for rentals and ride-hailing apps, and needing to re-apply for loans due to slipped deadlines.
Tesla is not alone in leaving customers waiting longer than they had hoped for their new, fully electric cars. Last week, for example, newly public competitor Rivian Automotive notified people who had reserved their R1S, a sport utility vehicle, of delivery delays.
Still, sales have grown this year for Tesla seemingly unbowed by unpredictable delivery dates.
Vehicle deliveries, which are the closest approximation to sales reported by Elon Musk's electric vehicle and renewable energy business, amounted to about 500,000 total in 2020. During the first three quarters of 2021, Tesla had already reported deliveries of 627,350 vehicles.
Since the start of 2021, the company has not provided a clear target for 2021 vehicle deliveries. But Tesla has reiterated its loose guidance for "50% average annual growth in vehicle deliveries" over a multiyear horizon, including on its third-quarter earnings call.
JL Warren Capital's CEO and Head of Research, Junheng Li, wrote in a note to investors last week that she expects Tesla sales to continue to rise, at least in China this quarter. "Soaring gas price benefits all new energy vehicle brands," in the country she noted.
Some 1.3 million electric vehicles were sold in China in 2020, according to Canalys research. The firm predicted that the number would grow to 1.9 million EV sales in China by the end of this year.
China remains the world's largest market for new cars, with strong government support for going electric.
Here's the full e-mail that Elon Musk sent out on Friday to all Tesla employees (transcribed by CNBC).
From: Elon Musk
Subj. Q4 deliveries vs. cost efficiency
Date: Nov. 26, 2021 [time stamp redacted]
Per my email several weeks ago, our focus this quarter should be on minimizing cost of deliveries rather than spending heavily on expedite fees, overtime and temporary contractors just so that cars arrive in Q4.
What has happened historically is that we sprint like crazy at end of quarter to maximize deliveries, but then deliveries drop massively in the first few weeks of the next quarter. In effect, looked at over a six month period, we won't have delivered any extra cars but we will have spent a lot of money and burned ourselves out to accelerate deliveries in the last two weeks of each quarter.
We will still have quite a big wave of deliveries in the last few weeks of December, as we don't yet have high volume production either in Europe or Texas, which means a lot of cars on boats from China to Europe and on trucks [and/or] rail from California to the East Coast arriving late in the quarter, but this is nonetheless the right time to start reducing the size of the wave in favor of a steadier and more efficient pace of deliveries.
The right principle is take the most efficient action, as though we were not publicly-traded and the notion of "end of quarter" didn't exist.
News Source: CNBC
Police: No Arrests After Stolen Vehicle Hits Multiple Other Cars In St. Paul
ST. PAUL, Minn. (WCCO) — Police in St. Paul say an auto theft suspect eluded capture Wednesday night after hitting multiple other vehicles with the stolen car.
At 8:20 p.m., officers responded to Arcade Street and Jenks Avenue. A Cadillac Escalade stolen from Buffalo, Minnesota, earlier in the day had been tracked there via GPS, according to the St. Paul Police Department.READ MORE: 2 Hurt In Separate St. Paul Shootings Wednesday Night; 1 Arrested
A short time later, the stolen vehicle was involved in a crash at the intersection of Earl Street and Case Avenue. A Ramsey County sheriff’s deputy responded, and said the occupants of the stolen vehicle ran from the scene.READ MORE: Robbinsdale City Council Member Tyler Kline Charged With DWI, Fleeing Police
The other driver involved in the crash, a 30-year-old woman, was taken to Regions Hospital with injuries that were not life-threatening.
Officers found two other vehicles nearby that were apparently struck by the stolen vehicle.MORE NEWS: Twin Cities Man Facing Federal Charges For Straw Purchasing Guns, Including One Used In St. Paul Mass Shooting
Police said this is an open investigation, and no arrests have been made.