I&#x27;m undecided on whether Model X was a mistake even when seen in retrospect. It might be the case. But assuming that it was, Tesla couldn&#x27;t have known this beforehand. Model S demand turned out to be more than twice as high as Tesla initially expected -- at least six months of the Model X delay was caused by the deliberate decision to increase Model S production rather than carry on with the initial plan to produce Model X right away. <i>Maybe</i> Tesla could have backed water at this point, but I&#x27;m not sure that it would have been a good risk-adjusted move, given that Model X represents very good diversification in the premium-vehicle segment. There is low overlap between luxury sedan and luxury SUV buyers.<p>Model X was initially thought necessary to produce enough revenue through the time at which Li-ion batteries could be produced cheaply enough in large quantities to launch a cheaper, good electric car. That the Model S turned out to be so popular wasn&#x27;t at all obvious in 2012, when it first entered production.