Tens of thousands of people have canceled their Tesla Model 3 orders

About 63,000 people have canceled their Tesla Model 3 orders in the past year, Tesla CEO Elon Musk said during the electric-car company's quarterly earnings call on Wednesday.

Total orders for the entry-level electric luxury sedan dropped from about 518,000 to 455,000, Musk said, but he suggested the cancellations were merely a drop in the bucket, because the company has averaged about 1,800 new Model 3 reservations per day since Friday, when the first 30 cars were handed over to Tesla employees.

Customer deliveries will begin this fall.

Musk took the cancellations in stride, saying Tesla could drive up the Model 3's reservation queue with little effort, but he said, at this point, it wouldn't serve the company or its growing legion of potential customers.

"It's like if you're a restaurant and you're serving hamburgers and there's like an hour-and-a-half wait for hamburgers - do you really want to encourage more people to order more hamburgers," Musk said. People who put down a deposit for a Model 3 at this point likely won't see their cars until the end of 2018, according to most estimates.

Tesla aims to produce 20,000 Model 3 cars per month by December, a journey Musk bluntly described as "production hell" during the handover event at the Tesla factory in Fremont, California, last week.

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