Tesla CEO and co-founder Elon Musk says that production planning for its next electric vehicle, the Model Y electric SUV, is ahead of schedule and it will be launched in the northern hemisphere’s summer of 2020, instead of its autumn.
Fortified by a solid quarter that saw almost 80,000 Model 3s delivered globally, delivered a profit that beat analysts expectations, and boosted cash and equivalents, Musk said the company was ahead of schedule for its new electric crossover SUV.
“We’re ahead of schedule on Model Y preparations in Fremont and we’ve moved the launch timeline from fall 2020 to summer 2020,” Musk said during the Californian car-maker’s quarterly earnings call on Wednesday afternoon (US time).
The new start date also confirms a leak we reported on last Wednesday, that came as spotters started seeing release candidates of the Model Y recently in California.
— TeslaOwnersofMA (@TeslaOwnersofMA) October 16, 2019
Musk has taken a ride in one of these prototypes himself – and is so pleased with new electric crossover he thinks it will outsell all other Tesla vehicles combined.
“I’ve actually recently driven a Model Y release candidate and I think it’s going to be amazing and be very well received,” he said.
“I think it will outsell S, X and 3 combined.”
If this proves correct, potential demand for the Model Y will be met via both an increase in production at the Fremont factory, at the soon to be opened Shanghai factory and also at the new European factory, the site of which will be announced in the not-too-distant future.
“We are positioned to accelerate our growth further through Gigafactory Shanghai, Model Y and also through increasing build rates on our existing production lines,” the company wrote.
“We are in the final stages of our site selection process. Our European Gigafactory is expected to produce both Model 3 and Model Y.”
When the Model Y, three-quarters of which based on the EV maker’s best-selling Model 3, was first unveiled in March 2019 with first deliveries of its high-specced Performance version planned for the US autumn in 2020.
But thanks to a range of efficiencies gleaned from both the tightening of production of the Model 3 as well as the speedy construction of the Shanghai Gigafactory 3, Tesla can now start some time in the second quarter of 2020.
Further details behind the revised launch date were revealed in the EV maker’s Q3 earnings update letter this morning.
“Trial production of Model 3 in Shanghai has begun, ahead of schedule. We are also ahead of schedule to produce Model Y and now expect to launch by summer 2020,” the company wrote.
“Model Y equipment installation is underway in advance of the planned launch next year. We are moving faster than initially planned, using learnings and efficiencies gained from our Gigafactory Shanghai factory design.”
When it does begin production, the Californian carmaker expects that the ramp up to volume production will be quicker than the Model 3, for which it faced hurdles in 2018 as it began making large volumes of cars for the first time in its 6 year history.
By mid-2020, Musk expects 1,000 Model Ys a week to be rolling off the factory floor.
“What really matters is the timing of volume production, where production is in excess of 1,000 units a week and we’re confident of reaching that point earlier than the middle of 2020,” he said.
Tesla also expects that profit margins for the Model Y – which will go sale at a slightly higher price than its sister sedan – will be higher than that of the Model 3, thanks to a tight control on costs which it has estimated will be on par with that of the Model 3.