Although Tesla shares have been taking a beating recently — having fallen by about 85 points in the last three weeks alone — the electric automaker had some good news to share earlier today. In a press release regarding first quarter production and deliveries, Tesla boasted that it manufactured a record-breaking 34,494 cars during the March 2018 quarter. As a point of reference, that figure represents a 40% increase from the most recent December quarter.

As to how the production figure breaks down across vehicle type, 24,728 vehicles were either Model S or Model X units while 9,766 were Model 3 units. With respect to the Model 3, Tesla averaged a production rate of about 814 units per week. More importantly, though, is that Tesla successfully manged to ramp up production before the close of the quarter. To this point, Tesla during the last week of the quarter managed to manufacture 2,020 Model 3’s, an impressive figure to be sure, though still below the 2,500 units it was aiming to hit before the start of the second quarter.

Regardless, the larger takeaway here is that Model 3 production appears to be on the up and up. Just last week,  some analysts were of the mind that Model 3 production was still in the 1,100 range. Going forward, the pressing question is whether or not Tesla will be able to boost Model 3 production to 5,000 units per week. If you recall, Elon Musk said Tesla would be able to hit that threshold by the end of June of this year.

It’s also worth noting that Model 3 production quality, according to the press release, reached an all-time high during the recent quarter. Moreover, Tesla boasts that customer satisfaction with the Model 3 stands at 93%, a figure which the company notes is “the highest score in Tesla’s history.”

The company’s full press release can be viewed below:

Tesla Q1 2018 Vehicle Production and Deliveries

Q1 production totaled 34,494 vehicles, a 40% increase from Q4 and by far the most productive quarter in Tesla history. 24,728 were Model S and Model X, and 9,766 were Model 3. The Model 3 output increased exponentially, representing a fourfold increase over last quarter. This is the fastest growth of any automotive company in the modern era. If this rate of growth continues, it will exceed even that of Ford and the Model T.

We were able to double the weekly Model 3 production rate during the quarter by rapidly addressing production and supply chain bottlenecks, including several short factory shutdowns to upgrade equipment.

In the past seven days, Tesla produced 2,020 Model 3 vehicles. In the next seven days, we expect to produce 2,000 Model S and X vehicles and 2,000 Model 3 vehicles. It is a testament to the ability of the Tesla production team that Model 3 volume now exceeds Model S and Model X combined. What took our team five years for S/X, took only nine months for Model 3.

Given the progress made thus far and upcoming actions for further capacity improvement, we expect that the Model 3 production rate will climb rapidly through Q2. Tesla continues to target a production rate of approximately 5,000 units per week in about three months, laying the groundwork for Q3 to have the long-sought ideal combination of high volume, good gross margin and strong positive operating cash flow. As a result, Tesla does not require an equity or debt raise this year, apart from standard credit lines.

Q1 deliveries totaled 29,980 vehicles, of which 11,730 were Model S, 10,070 were Model X, and 8,180 were Model 3. Net orders for Model S and X were at an all-time Q1 record, and demand remains very strong. Model S and X customer vehicles in transit were high. 4,060 Model S and X vehicles were in transit to customers at the end of Q1, which was 68% higher than at the end of Q4 2017. An additional 2,040 Model 3 vehicles were also in transit to customers. These vehicles will be delivered in early Q2 2018, which keeps us on track for our full-year 2018 Model S and X delivery guidance.

Finally, we would like to share two additional points about Model 3:

The quality of Model 3 coming out of production is at the highest level we have seen across all our products. This is reflected in the overwhelming delight experienced by our customers with their Model 3’s. Our initial customer satisfaction score for Model 3 quality is above 93%, which is the highest score in Tesla’s history.
Net Model 3 reservations remained stable through Q1. The reasons for order cancellation are almost entirely due to delays in production in general and delays in availability of certain planned options, particularly dual motor AWD and the smaller battery pack. As described above, owner happiness with the product is extremely high.
We would like to thank our customers, suppliers and investors for their continued patience and belief in Tesla.

Our 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. Final numbers could vary by up to 0.5%. Tesla vehicle deliveries represent only one measure of the company’s financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.

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