Putting Tesla's Blockbuster Model 3 Weekend Into Context

Model 3. Image source: Tesla.

The auto industry isn't accustomed to this sort of thing.

Last week, anxious Tesla customers lined up Thursday morning in order to place a reservation for the Model 3 that would be unveiled later that day. Some lines totaled as long as 800 people, and took five hours to sit through. All for a car that no one had ever seen before. We're used to seeing this phenomenon for iPhone launches each year, but that's a $600 smartphone and not a $35,000 car. When was the last time any car from any company got this much interest?

By the time that Elon Musk took to the stage to unveil the mainstream EV, reservations had climbed to 115,000. By the end of the first day the total tally had climbed to 180,000. The next day started off at 198,000, and then it hit 232,000. By early Saturday, the count was 253,000 but it grew to 276,000 by the end of the day.

Let's put that massive order backlog into context.

That's more than twice the number of Teslas sold to dateAs of the end of last quarter, Tesla had sold nearly 110,000 vehicles cumulatively, including the Roadster, Model S, and Model X. The company's first-quarter guidance called for 16,000 vehicle deliveries, which should bring the cumulative total up to about 126,000.

Over the course of three days, the Model 3 reservation total is over twice the number of cars that Tesla has sold throughout its short life.

That's more than than the entire U.S. plug-in market for the past two yearsAccording to InsideEVs, there were a grand total of approximately 122,000 plug-in cars sold in the U.S. in 2014. That total took a hit in 2015 thanks mostly to plunging gas prices, which hurt sales on all alternative fuel vehicles. Even still, there were still over 116,000 plug-in cars sold last year. These figures include the Model S.

So there were about 238,000 total plug-in cars sold in the U.S. over the past two years. Model 3 reservations topped that in a few days.

That's nearly a quarter of Obama's 7-year planWay back in 2008 as the Great Recession was about to hit, President Obama set an ambitious goal of getting 1 million plug-in EVs on U.S. roads by 2015. The administration supported a variety of incentives and subsidies to support the burgeoning market, but it still wasn't enough. By the end of 2015, the grand total stood at just 400,000.

As Obama prepares to leave the White House, the Model 3's reservation total will partially catch up to that initial goal. Better late than never.

That crushes the 3 Series and C-ClassOn the gas-powered front, rivals BMW and Daimler Mercedes-Benz dominate the entry-level luxury sedan market with the respective 3 Series and C-Class. Here's how both venerable cars fared over the past two years.

Data source: Company reports.

Over two years, each vehicles' total sales were still less than the Model 3 reservation total.

If you build it, they will buyOf course, Model 3 reservations are exactly that: reservations. These are not confirmed orders yet. Now comes the hard part. Tesla will now need to prove that it can actually produce all those cars before those customers lose patience, since the mainstream is a completely different (and more competitive) market segment.

Musk estimates that the average transaction price of Model 3 will be $42,000, which means the current order backlog is valued at $11.6 billion. Even if a fraction of those reservations end up canceling, the new car is still making EV history.

The article Putting Tesla's Blockbuster Model 3 Weekend Into Context originally appeared on Fool.com.

Evan Niu, CFA owns shares of Tesla Motors, andhas the following options: long January 2018 $180 calls on Tesla Motors. The Motley Fool owns shares of and recommends Tesla Motors. The Motley Fool recommends BMW. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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