Elon Musk Wants to Sell 100,000 Tesla Semis Annually by 2023
The automaker expects to pull off such large commercial orders even when the Model 3 already faces delays.
If there's one saying that Tesla CEO Elon Musk must be familiar with, it's "shoot for the stars." Take it literally or figuratively, the billionaire certainly has no problem setting higher than expected goals for his companies, as well as literally sending a car to outer space. In a recent conference call, Musk revealed that Tesla plans to massively scale its ability to manufacture the Semi during the next five years.
Tesla is expected to begin production of its Semi in 2019, having already opened up reservations for interested companies to get in line. Within four years of beginning production, Musk predicts a reasonable production expectation of around 100,000 annually. No in-between numbers have been quotes, nor when the first production trucks are expected to hit the streets, but the CEO feels comfortable to discuss the overall "big picture" without going too far into detail.
"It’s easier to predict, far easier to predict the endpoint or the steady state of the S-curve than anywhere on that exponential or log curve." Musk explained in a conference call, "So if you take four years, I think 100,000 units a year is a reasonable expectation. Maybe more, but that’s the right – roughly the right number, I think."
Given the number of Class 8 trucks produced in the industry is projected to reach a new high of 280,000 units in 2018, the 100,000 figure would land Tesla somewhere between 35 percent and 38 percent of total sales volume give it reaches the quoted number of production units.
It is projected that Tesla has around 530 reservations of its Semis already. Given the $20,000 deposit that is required, the company has likely raised a whopping $10.5 million, which is around the same as its relative, The Boring Company, has with its flamethrowers in deposits alone. This means that Tesla is sitting on a stockpile of cash (more than $95 million) thanks to already-pledged semi orders.
But that number is a drop in the hat compared to the 100,000 units Musk hopes to build. Tesla could push an annual revenue of $18 billion on commercial trucks alone, or enough to cover the current day-to-day operations for a little more than four years.
Musk has been known to be overly-ambitious when it comes to production numbers and timelines, something which has landed the Model 3 into a self-described "production hell" that seems to be costing the company in the quality control category. Regardless, the commercial industry is a whole different story. On top of manufacturing the trucks, Tesla must also come up with a plan to mass-deploy its Megachargers so that the Semi can utilize charging away from home. Competing with big oil companies and current trucking industry leaders will be tough, but if Musk has taught us anything, it's to expect the improbable.
- RELATEDBrown Goes Green as UPS Orders 125 Tesla SemisUPS and other couriers are viewing the all-electric Semi as the future of trucking.READ NOW
- RELATEDCanada to Promote Adoption of the Tesla Semi with a $75,000 RebateA penny saved on an electric Tesla Semi is a penny earned, eh?READ NOW
- RELATEDTesla Semi Orders Boom as Anheuser-Busch and Sysco Order 90 Additional EV TrucksMore companies see the spark by cutting costs with electrified commercial transportation.READ NOW
- RELATEDHooray Beer. Anheuser-Busch Orders 40 Tesla Semi TrucksThe company wants to help reduce its carbon footprint.READ NOW
- RELATEDTesla Semi Enters the Growing Electric Bus and Truck TrendElectric buses and trucks are increasing in popularity due to their fuel efficiency, reduced emissions and cost-effective maintenance.READ NOW