There have been numerous speculations that Tesla Motors Inc (NASDAQ:TSLA) is not able to produce enough cars to meet the all the demand effectively or in short, it is production-constrained. However, the myth of Tesla being production-constrained is not entirely true if a German TFF Forum, Forum für Tesla is to be believed.
Tesla could play one-off card
As per the forum, there are 100 new Model S cars that are supposedly available for sale in Frankfurt. Also, there are many other clues suggesting peaked deliveries and demand including low analysts’ projections for the near term quarters. However, a report from Seeking Alpha by Paulo Santos states that Tesla Motors Inc (NASDAQ:TSLA) still has a one-off card, which is inflating the single quarter’s deliveries by reducing the delivery time. Tesla should deliver more cars in the first quarter, which are scheduled for delivery, in the second quarter.
In U.S., there have been some evidence of reduced delivery times, and now a car inventory in Europe “makes it even more likely,” says the author. By using this one-off card, Tesla might achieve its own delivery guidance of 6,400 vehicles for the first quarter, believes the author. However, the one-off card might create problems for the second quarter.
If Tesla Motors Inc (NASDAQ:TSLA) is able to lower the delivery time then for the second quarter the company would have to rely on real, ongoing demand, which excluding China has peaked in all the markets, believes the author. In such a case, the deliveries in the second quarter, excluding China, will be flat or lower than the first quarter.
Doubt on reliability
One more thing that could go against the Tesla Motors Inc (NASDAQ:TSLA) is the increasing consumer reports questioning the reliability factor of the Model S. As of now, most of the consumer reports have rated the vehicle as average in terms of reliability, and JD Power, one of the most trusted reports will only come out with the 2014 initial quality survey, in the middle of the year.
Presently, Tesla Motors Inc (NASDAQ:TSLA) owners are content with the prompt customer service from the company, and extra efforts it puts in to make the glitches bearable. However, author feels “this won’t last forever,” and some of the glitches will prove very expensive if not covered in the warranty.
