Author: ZHU Yulong
Source: https://xueqiu.com/6659575183/168114612
Translation/Edit: MoneyballR
What was interesting today was that as Tesla US started another round of price corrections, Model Y added standard range version despite claims that short-term this would not happen. Starting price is at $41,990.
Model 3 Price and Insurance Data Review
The version based on ternary battery — which had its price cut by $ 8K and has EPA around 393 km — is obviously part of Tesla’s efforts to get more US orders, but also a sort of preview for China as I believe that China might see this version mid-year. NE-Times Research split different versions and their insurance data. Although the data and compliance certificate numbers are lagging, by using price correction data, we can still make an initial assessment.
1) May-September: EV sales during this period were insipid. The drive in private consumption was not obvious. As ternary version entered RMB 270K territory on May 1, Model 3 sales continued to increase, volume was at 10K-15K. LR version is actually not a favorite of the Chinese market as its share is below 20%. It was only when its price was cut by RMB 30K that it managed to sell 7K, but only to quickly drop back to 3.8K.
2) October price correction: Only after LFP version price was cut down, we could see previously accumulated orders. Ternary version inventory was at only 13K. We can interpret this as Tesla leaving inventory for a month and then in October increasing LFP version production capacity to 25K as to deliver them all in November. Based on what we earlier learned about production capacity, after vehicles broke 25K production capacity, Tesla’s January has 6K + 2.5K of weekly capacity, i.e. production capacity for 24K units of Model 3 and 10K of Model Y. Among them, Model 3 is 80% LFP and 20% NMC. Model Y is entirely NMC.
US Model Y SR introduction might be the preview of what might happen in China.
Model Y LFP version introduction time is affected by several following factors:
1) LFP Model 3 orders: Based on orders accumulated in a month or so, if Model 3 SR orders received in three months from October 1 are gradually consumed at 24K/month rate, demand from consumers holding their money to buy Model Y will affect new orders for Model 3. We can estimate that this rate matching will be consumed by around April.
2) Model Y LR orders: January orders will be delivered by Q2. Based on estimated 10K-15K production capacity ramp up, actual Model Y orders are at 30K-40K. Since part of consumers are still waiting and do not want to be swayed by another LFP price cut, we can estimate that the new Model Y orders speed and Model Y production capacity will converge in June. This assessment might be flawed as we are still waiting for December insurance numbers. But we can confirm that SR based on Model Y LFP will not be released very late and that it is in direct relation with production capacity boost. I think Tesla GF3 is a big factory, which continuously cuts cost, so when production is increased, but orders are low, it simply cuts the price. The good news here is that it will bring a substantial part of ICEV users to look at Tesla and then compare it to several EV startups. It is reported that over 40% of NIO buyers first went to see Tesla.
Conclusion: I personally think that market dichotomy (B+ and A00 size), which is pushing out A-size EVs out of the market, will become more visible this year. Mid-size vehicles share will be further lowered. As for the question in what stage is Chinese RMB 160K Tesla (for Europe is $ 25K version), I believe that might be the matter for 2022.
