Tesla reached a major milestone today, producing their 1 millionth vehicle. The 1 million milestone was celebrated with a photo the Model Y, along with Tesla staff who assemble and build these vehicles.
The Model Y is about to begin shipping to customers in the US, in just a few days and is the 5 vehicle Tesla has made, the 4th the company has designed.
Lets take a second to reflect on how far Tesla has come to reach this major milestone.
- February 2008 – The first Tesla Roadster was delivered.
- June 2012 – The Model S deliveries began.
- September 2015 – Deliveries began of the Model X
- July 2018 – The first 30 deliveries occurred of the Model 3.
From humble beginnings 16 years ago, co-founder Elon Musk has seen the company through an extraordinary growth period and through great product design and engineering has changed the way the world looks at electric vehicles.
Electric vehicles are now widely accepted as the future drivetrains that will power virtual every type of vehicle. Thanks to a dramatically simplified electric motor, they feature dramatically less parts, while offering stunning performance and no emissions.
When I shared this news on Twitter this afternoon, one of my followers Gavin gave some perspective.. that GM makes around 7 million cars each and every year. While that’s true, GM has been around for 111 years and those sales numbers are on a significant decline, down from highs of 10 Million back in 2016.
There’s a substantial transition happening in the auto industry as battery volumes and chemistry improves, the cost is coming down. This means EVs are rapidly becoming the car of choice and when we hit price parity, sales of combustion engines will be seen as old technology and fall off a very, very steep cliff.
Best estimations place this price parity around 2024/2025 and given the average production cycle of a new vehicle is 3-5 years, we’re looking at the end of combustion engine development now, as those investments would never pay back and vehicles would certainly have extremely poor resale values.
In 2019, Tesla produced 255,498 cars in total, but we need to understand a couple of important things before we can really appreciate the roadmap ahead.
Tesla recently launched their battery and vehicle manufacturing facility, Gigafactory 3 in Shanghai China, to add to an expanding Gigafactory 1. The two giant locations will enable Tesla to produce Model 3 and Model Y at a higher volume than ever before and they’re not stopping there.
Gigafactory 4 is in construction in Germany, which once online, aims to deliver vehicles right into the heart of the European auto industry. Combine that with a great runway of Cybertruck and Tesla Semi and the company looks to be well positioned from a production and product stand point.
It will take a while to hit 1 Million vehicles per year for Tesla, but that competition everyone was expecting, continues to be delayed or cancelled for one reason or another.
While Tesla produces less vehicles now than companies like Ford, GM and Toyota, the writing is on the wall for all that to change in the next 5-10 years and that must makes for some difficult board meetings.
Musk has expressed that the real race is the rate of innovation and after receiving another OTA update to my Model 3 today, it’s clear nobody comes close to Tesla’s ability to ship.
A highly under-rated feature of electric vehicles is just how many new possibilities are possible when you have the right tech stack. Not only are Tesla leading the field in Computer Vision-powered autonomous driving, but they also lead the way on fun, cool and exciting features that make owning a Tesla unlike owning any other vehicle.
Congrats to the close to 50,000 employees at Tesla who contributed to achieving today’s 1 Million milestone and congrats Elon.