For a really long time, Tesla could do nothing wrong in Norway, its third largest market after the United States and China. As Tesla watched its sales explode in the Scandinavian country, the electric car maker’s service capacity was stretched to the limit. Elon Musk kept his focus on ramping up Model 3, while the wait times for service center appointments in Norway shot through the roof.
Norway: Foot off the Pedal
Tesla has taken several efforts to improve its service center operations in the country but the company has a long way to go. In the interim, Tesla has decided to take it a little bit easy on the sales front in Norway and give some breathing space to improve service capacity.
In Norway, Tesla delivered just 64 units of Model S and Model X in July, a far cry from the 160 units the company sold in July last year.
As Tesla took the foot off the pedal in Norway, the Dutch seem to be getting all the attention. In the first seven months of the current fiscal, January to July, Tesla has sold 1,927 Model S and Model X in Netherlands, slightly better than the 1,877 units the company sold in Norway.
Netherlands: 1,927 +122.5% y/y
Norway: 1,877 +106.3% y/y
I expect Netherlands to stay in front for the rest of the year as 2019 orders being brought forward before BIK tax increases (BEV >€50k) Jan 1 2019 pic.twitter.com/bHLVFhOIDE
— Matthias Schmidt (@auto_schmidt) August 21, 2018
This will be the first time the Netherlands has climbed the ladder to become the third largest market for Tesla. The electric car maker has sold a little more than 3,000 Model S and Model X in Netherlands, which is more than double the 1,386 units the company sold during the same period last year.
Should we worry about the trend?
A little bit. Tesla has made it clear that it wants to provide a unique experience to its customers by staying in firm control of its sales and service network. Tesla is the only auto company of its size to directly own its sales and service network. No one asked them to do it. They did it on their own.
What happened in Norway was a mistake – and a huge one at that. We can keep talking about how much pain Elon Musk and Tesla employees in Fremont and Gigafactory 1 went through in the last six months to increase Model 3 production from less than 1,000 units to more than 5,000 units, but if you are in Norway and waiting for a service appointment, then you want to get your car serviced, not hear about why it’s taking so long.
Hopefully, this will be a huge lesson for Tesla management to keep a close eye on service capacity and proactively scale it when it anticipates sales increase in a particular market. The immediate question now is: will the Netherlands go the way of Norway on the service front? Hopefully not. If there’s one thing Tesla has shown, it’s that it’s a fast learner.
Nevertheless, with the Model 3 expected to reach European shores in the next couple of quarters, now is not the time to leave customers worried about service issues. Now is the time to keep them talking about how the Standard Battery Model 3 races to 60 miles per hour in under six seconds while competitors like BMW need another two seconds to get there.