Thread by @TSLAFanMtl

1/Time to debunk some "Tesla is failing in EU" FUD.

First, bulls & bears, let's all agree on one thing = it takes supply to make sales. Fewer cars built = fewer potential cars sold. Simple, right? cannot sell what they do not have. Agree? Good. Let's move on.

2/Let's also consider what is being sold in Europe.

Model 3
Model S
Model X

is not selling Model Y in Europe.

Model Y is being sold exclusively in NA until Giga Berlin comes online for EU consumption, and Giga Shanghai's Model Y line comes online for China consumption.

3/ Next, let's discuss where Tesla builds their cars.

Fremont = S/3/X/Y
Giga Shanghai = 3 for China sales only

Next, let's discuss which production lines make the cars in Fremont;

GA 1/2 = Only S & X
GA 3 = Only M-3
GA 4 = Only M-Y

I am sure we all agree on these facts.

4/ Next, let's discuss how things have changed over these past few quarters. Prior to the launch of Model Y, Tesla was building Model 3 on 2 production lines:

GA3 = rate of 600-650/day
GA4 = rate of 300-350/day

Since Model Y has launched, GA4 has been dedicated EXCLUSIVELY...

5/...to Model Y production.

Gee, I wonder what impact this had on Model 3 production? Let's see.

Tesla produced 128k 3/Ys in Q320.

We know for certainty that Giga Shanghai produced 37.5k Model 3s, thus:

128 - 37.5 = 90.5k 3/Y produced in Fremont in Q320.

We can also...

6/...assume that Tesla built approximately 30k Model Ys in Q320. 2 data points support this:

1. @TroyTeslike 's Model Y VIN tracker for Q3
2. Known production data for GA4. At a rate of 300-350/day, production of between 27-32k is expected.

So let's round things out...

7/...and estimate that Tesla produced 30k Model Ys in Q320.

What does that leave us with?

90.5k - 30k = 60.5k Model 3s produced in Fremont in Q320.

This is simple, unbiased mathematics. Next, the implications: produced 79.6k Model 3s in Q319. That is exactly 19.1k LESS..

8/...Model 3s produced in Fremont in Q320 vs Q319. Why? Because would rather sell Model Ys in NA than Model 3 in EU. Model Y is a higher GM product, in a larger and faster-growing segment of the market.

This just makes sense.

With 19k FEWER Model 3s MADE in Q320 than Q319

9/ ...why is ANYONE surprised that Model 3 sales are down in EU or ANYWHERE outside of China, where new production has come online.

Let me be perfectly clear.

Nothing that any of the OEMs have done in Europe has contributed to Tesla's declining Y-o-Y sales in EU. This is...

10/...100% the result of decreased Model 3 production and 100% intentional on Tesla's part. Tesla EU sales will climb as soon as the company will supply the market with new capacity from Giga Berlin, or when Giga Shanghai exports to APAC and frees up some capacity that would...

11/ ...have otherwise been put on a boat for Hong Kong, Korea, Japan, etc.

This is why its important to evaluate Tesla's business from a high level and not cherry-pick data from any one region without understanding the context. This is a mistake that repeats constantly.

12/ It also illustrates why one should not evaluate one aspect of Tesla's business or one region in a vacuum. These things are all connected, and unless one takes a broad view and understands the strategy, its easy to reach the wrong conclusion.

This topic seems to be popular. Here is another more technical thread explaining the concepts of supply, demand and volume sold.

https://twitter.com/TSLAFanMtl/status/1302639153880932355?s=19