During the Q4 and FY 2022 earnings call, Elon Musk emphasized the strong demand for Tesla vehicles, particularly in January. As a result, the company has decided to slightly increase the prices for certain models. This assertion was further reinforced by the delivery estimate for the Model Y Long Range, which suggests that the demand for Tesla vehicles remains robust.
A recent examination of the Tesla Model Y configurator revealed that the delivery estimate for the Long Range Dual Motor AWD variant has been shifted from February to March 2023 to March to May 2023. This change in delivery estimate indicates that the high demand for Tesla vehicles, particularly the Model Y, continues to remain a driving force behind the company's growth.
The increased delivery time for the Model Y Long Range indicates high demand that is outpacing Tesla's production in the US, despite having two factories, Fremont Factory in California and Gigafactory Texas, producing the Model Y.
The Fremont Factory, a repurposed vehicle plant, has a yearly capacity of 550,000 Model 3 and Model Y, while Gigafactory Texas has an annual capacity of over 250,000 Model Y. The strong demand this quarter is largely due to the aggressive price cuts in January, which CEO Elon Musk noted as having a significant impact on orders.
“Thus far in January, we've seen the strongest orders year-to-date than ever in our history. We currently are seeing orders at almost twice the rate of production… And we've actually raised the Model Y price a little bit in response to that… So basically, price really matters. I think there's just a vast number of people that want to buy a Tesla car but can't afford it. So, these price changes really make a difference for the average consumer,” Musk said.
