leaf16 wrote:Tesla is now stuck in the difficult position with the Model 3 production, where if they can / and do increase the production rate much above the reported current 2,500 per week rate --- they will hit the 200,000 Cap Limit for the $7,500 Fed Tax refund this Quarter (ends June 30th).
Not really new news. People predicted they would hit 200K in 4Q17, then 1Q18, and now 2Q18. By some estimates they got 6 more months of full credit than was originally anticipated.
That would then only give them only the 3rd Quarter of this year at the $7,500 refund and deliveries in the last Quarter of this year would qualify for only a $3,750 refund.
leaf16 wrote:Gets only worse in 2019, the 1st Quarter refund would be only $1,875 (not much on a very expensive car) and zero after that.
Not quite. $3750 would be through 1Q19 and then $1875 for 2Q19 and 3Q19.
leaf16 wrote:If they do hold production down this Quarter, it will only delay hitting the Cap until the 3rd Quarter and delaying these numbers by 90 days (still not a good scenario).
It's a common misbelief that "holding production down" is the only way to avoid hitting the limit. I very much doubt they would actually hold down production (unless it served some other means such as gearing up for higher production rates or introducing new options like AWD and SR battery). Other options include diverting shipments to Canada or other non-US markets, and keeping production up, but stockpiling Model 3's for quick sale in 3Q18, maximizing the number of people able to take the credit. If they do go this route, I see a combination of all of the above.
leaf16 wrote:2019 will also bring in new competion with 200 + mile range capabilities and they will all have the full $7,500 refund available --- makes a real price point advantage when Tesla starts selling $35,000 cars.
True enough, but I think LATE 2019 and more likely early 2020 is when we will really see these. For sure it will be a headwind against Tesla, although Tesla will already have gotten through the production ramp that other manufacturers will have to climb themselves.