Musk quickly changed his estimation of how many Model 3s would be delivered in 2019.
Tesla has been going through a series of high-level departures in recent years. Now, the company announced Wednesday its general counsel, Dane Butswinkas, would leave after just two months on the job. He joined Tesla in December 2018 and reported to CEO Elon Musk, after previously working as Tesla’s outside counsel with firm Williams & Connolly, according to a Reuters report. The vice president of Tesla’s legal department, Jonathan Chang, will take over Butswinkas’ role immediately.
Tesla originally hired Butswinkas as external counsel last year to help settle the company’s case with the SEC. Elon Musk found himself and Tesla mired in an SEC investigation after tweeting he had secured funding to take the company private at $420 a share. In October 2018, he and Tesla agreed to each pay a $20 million fine to settle the case. Musk also relinquished his position as Tesla’s chairman for three years.
Tesla’s Chief Financial Officer Deepak Ahuja also left the company this month. After 11 years with the company, Ahuja departed after the company missed its projections for the last quarter of 2018. To date, the company hasn’t yet delivered on its promise to bring the $35,000 entry-level Model 3 to market. That version also recently disappeared from the Tesla Model 3’s configurator page, leaving doubt over whether Tesla will ever actually build it.
Musk: “400K deliveries in 2019”
Musk sent out a tweet on Tuesday saying, “Tesla made 0 cars in 2011, but will make around 500K in 2019.” However, that ended up being a bit of an error, as he lately corrected himself. In another tweet a few hours later, he said, “Meant to say annualized production rate at end of 2019 probably around 500k.” Deliveries for the year, meanwhile, will be around 400,000.
There are a few different ways to interpret that statement. If those numbers come to pass, it could mean Musk is planning a production surplus for the company’s cars by the end of the year. In other words, Tesla could build 100,000 more cars than actually make it to customers. Those 100,000 unit difference in production doesn’t necessarily mean the cars haven’t been sold, but they may be in transit to buyers at the end of 2019.
That tweet does not clarify exactly what the 100,000 unit difference in production versus deliveries means. Tesla’s Q1 2019 earnings report will shed some light on whether the company is progressing toward the production goal of 10,000 cars each week. Per the company’s Q4 2018 earnings report, the plan is to grow Model 3 production to a sustained 7,000 units per week by the end of the year.
Musk’s second tweet does fall in line with the company’s outlook as well. Per the earnings report, “In total, we are expecting to deliver 360,000 to 400,000 vehicles in 2019.” If that comes to pass, it would represent at least 45 percent growth from deliveries made in 2018.
Tesla’s stock prices fell roughly 2 percent this morning upon the news of Butswinkas’ departure.