Tesla's Model 3 Has More Refunds, Cancellations Than Deposits
SAN JOSE (KPIX 5) -- There's new trouble for Tesla and its Model 3 sedan. Refunds from pre-orders are now outpacing deposits.
On Thursday, Tesla's stock took a bit of a dive on Wall Street, losing more than one percent of its value. Some customers are having second thoughts.
Some customers love the Model 3 despite the long wait. "We were 22nd in line here. We got it. It took two years and ten days," said Nick Fenselau, a Model 3 owner. "That's a long time, but it's worth it."
But not all Model 3 customers agree. An analyst with Neeedham and Company reported that there are more people canceling their Model 3 orders than there are putting new deposits down. The analyst also said that 1 in 4 customers are asking for refunds.
Tesla has not responded to a KPIX 5 request for comment, but the company told Reuters News Service that the report is false.
But one customer said that the report is true in his case. "I just kind of bailed out and recently cancelled my order," said Dan Edmunds, who is the director of vehicle testing at Edmunds.com (no relation).
He says he's road tested some Model 3's as part of his job for the website. He canceled his personal order because he wasn't happy with the brakes and lack of availability for the much-hyped, $35,000 model.
"I was invited to configure my car in February, but they were only building the long range model with premium upgrades, and that was more money than I wanted to spend," said Edmunds.
Buyers may also be worried about losing a $7500 federal tax break, which is being phased out while they wait for their cars to be delivered.
"Certainly, a lot of the people waiting in line with me at 4 in the morning, they were in line for the $35,000 Tesla. They weren't the kind that were going to spend $50,000 on a car," said Edmunds.
Fenselau said his car cost $60,000. "I'm a Tesla enthusiast. I don't know why people would cancel it. It's worth waiting for. Just having it is worth a lot," he said.
After struggling, Tesla is now meeting its delivery targets.
One salesman said wait times for some models are down to two months.