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Brokerage Says Tesla's Model 3 Deliveries Far Below Estimate

Dec 27 (Reuters) - Tesla Inc is likely to deliver about 5,000 Model 3s in the fourth quarter, KeyBanc Capital Markets analysts said on Wednesday, far below the brokerage's estimate of 15,000.

The numbers indicate that the electric carmaker may still not be out of its self-described "manufacturing hell" for the production of the $35,000 Model 3 sedan.

KeyBanc analysts based their projections after conversations last week with sales people at 18 stores in the United States.

"We talked to stores in California doing as many as a dozen per week with around 10 being the average, and we estimate stores outside of California were doing something closer to half a dozen per week," the analysts wrote.

Tesla's shares fell 0.5 percent to $315.74 in premarket trading on Wednesday.

Palo Alto, California-based Tesla made just 260 Model 3 sedans in the third quarter against its own target to build more than 1,500 due to what it called "production bottlenecks."

The company said in November it expects to build 5,000 Model 3s per week late in the first quarter of 2018 from its original target date of December.

A further delay in Model 3 production could lead to postponed sales and exacerbate Tesla's cash burn. Over 500,000 customers have put down a refundable deposit for the car.

Tesla could not immediately be reached for comment.

However, KeyBanc maintained its "sector weight" rating on the stock.

Bullish investors in particular remain more focused on that the car is being produced with minimal defects and that consumer reviews and response are favorable, the brokerage said. (Reporting by Supantha Mukherjee in Bengaluru; Editing by Sriraj Kalluvila)

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