After Posting Record-Setting Reservations for the Model 3, Tesla's Now Facing a Massive Refund Exodus From Customers

TopSpeed

By Kirby Garlitos

Published Jun 5, 2018

Lingering production delays are the biggest reason behind the big volume of refunds

Two years after posting more than 400,000 reservations for the Model 3 electric car, Tesla is now facing a big pushback from customers, a lot of whom have begun asking for their money back because of frustrations with the extended production delays on the Model 3. According to data from analytics company Second Measure, almost a quarter of all the $1,000 deposits made on the Model 3 have been refunded.

The Tesla Model 3 is swimming in controversy. If it’s not the extended production delays, it’s news about the significant number of refunds the company has made from frustrated customers who have been waiting for significant production progress from Tesla. A lot of these customers put down the deposits with the expectation that they’d receive their vehicles by 2018. But because of the extended production delays, the initial timetables that Tesla was touting in the start have been scrapped, forcing a lot of people to cancel their reservations.

The data collected by analytics company Second Measure show that the honeymoon stage between Tesla and eager-beaver customers appears to be over. According to the company, 23 percent of all Model 3 deposits in the U.S. have been refunded as of the end of April. That computes to a little more than 100,000 reservations, a significant number considering the level of interest in the Model 3 when it was first announced back in 2016.

For its part, a Tesla spokesperson commented on the findings of Second Measure and said that the data did not align with its own internal data. As to how far off Second Measure’s data was? The spokesperson refused to elaborate, suggesting that there could be more to this than meets the eye.

The good news for Tesla is that even with the huge number of refunds, interest in the Model 3 remains high. New deposits are still coming in from a lot of people, even if it’s been reported that the refunds have started to eclipse the number of deposits Tesla is getting for the electric sedan. Still, it could be worse for the Model 3. The model is already getting great reviews and, refunds notwithstanding; it’s turning into the best-selling vehicle in its segment where it’s available.

This isn’t to say that the Model 3 is out of the shadows of controversy. There are still plenty of issues that need to be sorted out, including the purchase options that Tesla plans to have once production is in full swing. Speaking of which, Tesla is also trying to catch up to its own production timetable, arguably the biggest source of disappointment for a lot of customers.

The automaker will eventually step into sunnier days and smoother roads in the future, at least as far as production for the Model 3 is concerned. Let’s just hope that it happens sooner than later. Otherwise, Tesla could be in for more refund requests from disenchanted customers.

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