Tesla misses out on SUV hunger in US
san francisco — Not everything Elon Musk touches has been a runaway sales success.
While Tesla’s Model S has been a hit and thousands lined up to order the upcoming Model 3 sedan, the Model X sport utility vehicle hasn’t met the CEO’s expectations. Model X deliveries have yet to keep pace with the Model S, as Musk predicted, and US registrations of the SUV have slipped the last two quarters, according to IHS Markit.
Musk has chalked up challenges with the Model X to making the vehicle too complicated. Features including the double-hinged falconwing doors have constrained production and contributed to a costly $82,500 starting price. For Tesla, the lack of cheaper and easier-to-produce configurations has meant missing out on roaring demand amid America’s SUV boom.
“Luxury SUVs are really hot right now, and the Model X should have been a big hit and broadened Tesla’s audience,” said Michelle Krebs, an analyst with Autotrader.com. “You don’t hear a lot of buzz about the Model X, and when you do, it’s the negative stuff.”
Musk said on an earnings call this month that there’s enough demand for Tesla to sell 100,000 Model S sedans and Model X SUVs combined this year. Tesla worked through a backlog of Model X orders from overseas markets and built up supply of the SUVs in its test-drive fleet during the first quarter, both of which impacted US registrations, a spokeswoman said.
Tesla’s growing pains with the Model X have been well-documented, and Musk has been candid about challenges with the SUV’s doors and independently operable second-row seats. Several features were difficult to engineer and dependent, in part, on multiple components and suppliers.