Over a Half Million People Have Reserved A Tesla Model 3
Tesla has some big shoes to fill.
So far, Tesla hasn't tried to sell the general public a Model 3. They haven't spent money on mass-marketing for a car that doesn't have an abundant stock out of production just yet, nor are they really trying to. But that hasn't kept the public from reserving over half a million units from Tesla directly, says CEO Elon Musk at a press briefing on Friday.
When Tesla went dark about the number of pre-orders they have received, speculations around the internet swirled around a lot of potential buyers cancelling. As it turns out, the opposite was true. Not only were people not cancelling, but they kept reserving cars and throwing money at the automaker. In order to reserve a Model 3, it's as simple as entering customer details on Tesla's website and providing a credit card number. The company will hold onto $1000 while you wait for the car. If over a half million people have done this reservation, Tesla has easily brought in over $500 million in funding without the help of investors.
To put that into perspective, when the Pebble smartwatch company launched a Kickstarter for their defunct smartwatch, they raised $20.3 million and became the most funded campaign ever. Tesla blew that away and that only accounts for deposits on the vehicle. Should all 500,000+ people purchase the Model 3, Tesla would be looking at sales numbers between $17.5 billion and $29.8 billion for the single-motor variants alone. With a price as low as the Toyota Prius, it's clear that consumers want tech.
From working in Technology, I can tell you how much a tech company - just like any other enterprise - relies on marketing. Some of the bigger names in my industry throw entire events with big-name concerts just to advertise to their existing clients. Tesla has taken a very anti-marketing approach to selling their cars and have still been successful in the number of reservations received. In fact, the company is so backlogged that during the Model 3 event on Friday, Musk joked that his employees would be in "production hell" until late 2018, which is when he expects current Model 3 reservations to be filled.
Tesla has surpassed the expectations of its critics revolving around the low potential profit margin of the Model 3. They have provided enough incentive for buyers to purchase the long range battery at a minimal cost jump, while still securing the future of electric cars in the United States and around the world as a whole. Should Tesla continue down the path of scaling, they will easily hit their target of 5,000 units per week by the end of the year.