On Friday night in Fremont, Calif. Tesla gave the first 30 Model 3 customers their brand new, $35,000 electric vehicles.
But, more importantly for Tesla's stock, during a private media session CEO Elon Musk gave an upward revision to the number of customers that had reserved a Model 3. According to Musk, 500,000 people have reserved a Model 3, which is significantly more than the 370,000 last reported over a year ago. Each of those reservations requires a $1,000 deposit, which totals $500 million.
"We believe the bulls will take this as a sign of strong demand, which is positive for the shares," KeyBanc Capital Markets analysts Brad Erickson and Elliot Arnson wrote in a note to investors on Sunday. However, the analysts noted that Tesla would not confirm the figure Musk gave when they followed up with the company.
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Shares of Tesla fell 3.5% on Monday. They are up almost 58% so far this year.
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Erickson and Arnson said that the reservation figure is the most important figure for Tesla's business and will help the stock continue to ride an upward wave into the company's earnings report on Wednesday after the market close. "This is the most important metric and basis for the stock, in our view, and should make for positive near-term momentum into Wednesday's earnings report," the analysts wrote.
Tesla expects Model 3 production to ramp up from 100 cars in the month of August to 5,000 per week by December. However, if a customer wants their car customized, then there will most likely be a delay, the analysts predicted. The interior of the car lacks the typical instrument cluster seen in a car's driver side, they noted. However, Tesla says the simplicity of the car, including the consolidation of the driver's side controls to a 15-inch display near the center console, is intentional and will make for a better driving experience.
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