There's a whirlwind of speculation surrounding Tesla's second quarter and whether the company can hit the mark on deliveries. And in an email to his troops on Tuesday, Elon Musk tried to rally them in hopes of setting a new record.
The issue for Musk and Tesla is that the company has been exceedingly aggressive in its forecast for second-quarter car deliveries, saying that it hopes to hit between 90,000 and 100,000 units. Wedbush analyst Dan Ives told investors in a research note on Wednesday that he believes the more likely mark is between 84,000 and 88,000 units.
More important, Ives said, investors are concerned that if Tesla can't hit the mark in the second quarter, it might not be able to deliver the up to 400,000 units it had promised by the end of 2019, putting Musk and his fellow executives in a rough spot.
"In a nutshell, Tesla has become the ultimate 'prove me' stock, and it all must start with a good [second quarter] delivery unit number to restore Street-cred back in the story as Musk & Co. have talked the talk, now it's time to walk the walk, with the drumroll heading into next week as we expect production/delivery numbers likely before the July 4th holiday," Ives told investors.
Musk apparently knows that. So, on Tuesday, he sent a short email to his employees that was first reported by Bloomberg and leaked to CNBC. He didn't have a whole lot to say, but he tried his best to rally his troops.
Here's how he did it and what he said:
Acknowledge the Problem
Musk kicked things off with acknowledging that Tesla is under the microscope. He said that "there is a lot of speculation regarding our deliveries this quarter." He didn't get into the magnitude of that speculation -- or what it could mean for Tesla -- but suffice it to say, he got the point across: The pressure is on.
Set a New Record
Interestingly, Musk didn't sound the alarms like Ives did in his research note to investors. Quite the contrary, he said that Tesla is currently on pace to set a new quarterly delivery record. Again, he didn't say what the record might be or how many deliveries Tesla has made, but is it possible that Tesla really could set a new record?
Work on Logistics
The biggest problem standing in the way of Tesla's reaching its mark, according to Musk, is logistics. He said that the number of new Tesla orders can already set a new record, but the metric here is deliveries to customers. And, so far, he said, that's where Tesla is falling short. As of this writing, according to Musk, "The right cars are not yet all in the right locations."
Believe in Your Team
So, how did Musk end his email to the troops? With a little positivity.
"I have great faith in you," he told the employees. And, like any good CEO, he offered a helping hand: "Please let me know if there is anything I can do to help."
So, for now, we wait to see how Tesla performs and if the company can reach a new delivery record. By the sound of it, Musk believes it's doable.