Company employees stated that batteries were being hand built; Tesla claims it is on target to hit predicted output for 2018

Tesla Model 3 production was halted in the last week of February to allow the company time to fix automation issues and address bottlenecks.

The car maker said the production freeze, which took place from the 20 to 24 February, would now enable it to ramp up production to 2500 cars per week by the end of March.

Prior to the production halt, Tesla employees were said to be making batteries by hand in a bid to face growing a demand backlog. An unnamed inside source told CNBC that Tesla had been "borrowing" workers from Panasonic, with which it is partenered, to speed up production. They said quality control workers were also not experienced enough to ensure the job was done well enough.

But a Tesla spokesman responded by stating that the company had expected some parts of the production process to require "manual" work at that stage. "This is something Elon Musk [CEO] and Jeffrey Brian Straubel [CTO] discussed extensively on our Q3 earnings call, and it has no impact on the quality or safety of the batteries we're producing," they said.

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The firm admitted it was working to clear production ‘bottlenecks’ for the Model 3 as early as late last year. In the third quarter of 2017, 220 Model 3s were delivered, compared with Tesla’s prediction of 1500 stated in its second quarter report.

Tesla reassured stakeholders: “There are no fundamental issues with the Model 3 production or supply chain. We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near term.” 

The California firm delivered 1550 of its Model 3 cars to customers in the final three months of last year, short of the 4100 expected by most industry analysts. The firm's latest target to produce 2500 Model 3 per week by the end of the first quarter of 2018 is half its original target, which was to build 5000 cars per week. Tesla says it will reach 5000 models per week by the end of the second quarter. 

Analysis: Will the Model 3 make or break Tesla?

Despite the pushback in production for the entry-level model, for which Tesla received more than 400,000 orders in the month following its reveal, company CEO Elon Musk has remained calm in his statements and stated that issues are quickly being ironed out.

The car is due to arrive in the UK early next year, although Tesla is yet to confirm whether the production setbacks will affect the delivery time of UK-bound vehicles.

Tesla delivered 29,870 cars in the fourth quarter of 2017, including 15,200 Model S and 13,120 Model X. That is broadly in line with industry expectations that the firm would deliver 30,000 cars.

Read more:

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Comments
29

4 January 2018

Hmm would this happen at an established car maker? I seriously wouldn't want to buy something from Tesla when their experience of volume car making is so limited.

4 January 2018

Hmm would this happen at an established car maker? I seriously wouldn't want to buy something from Tesla when their experience of volume car making is so limited.

26 January 2018
TStag wrote:

Hmm would this happen at an established car maker? I seriously wouldn't want to buy something from Tesla when their experience of volume car making is so limited.

You are correct, nothing like this would happen at a major motor manufacturer!

Ten years ago if you'd said you could buy a 4 door electric car that could do 0-100mph in the same time as a Mclaren F1 most people would have though you were nuts.

The only real argument is whether the major manufacturers can work out how to produce an electric car as good as Tesla's before Tesla perfect producing a volume car as well as they do. 

13 March 2018
TStag wrote:

Hmm would this happen at an established car maker? I seriously wouldn't want to buy something from Tesla when their experience of volume car making is so limited.

I recall that VW suspended production of the Golf GTE recently due to "production bottlenecks". So would you not buy a VW group car either?

4 January 2018

Trouble is the underachieved production sounds bad in percentage terms but production is so low anyway its really just a piddly few cars here or there. But with so many resources and $$$ (or at least time to go out and buy resources such as poaching other companies production talent) it is surprising production isn't sorted and climbing exponentially by now...

4 January 2018

July:30, Aug:75, Sep:115, Oct:145, Nov:345 LAST WEEK in Dec:1,000. 

I.E. Nearly 3 times as many in Nov as Oct, nearly 5 times as many in Dec as Nov. - Exponential growth in my book

So as of now Tesla are the biggest builders of EV's (ahead of BAIC) and the Model 3 is by far the highest selling EV.

Agreed it was a major *****up to begin with, Musk is just too ambitious sometimes and needs to be pulled back

typos1 - Just can’t respect opinion

4 January 2018

Sorry mean’t by the end of Jan the Model 3 will be the highest selling BEV.

typos1 - Just can’t respect opinion

4 January 2018
xxxx wrote:

July:30, Aug:75, Sep:115, Oct:145, Nov:345 LAST WEEK in Dec:1,000. 

I.E. Nearly 3 times as many in Nov as Oct, nearly 5 times as many in Dec as Nov. - Exponential growth in my book

So as of now Tesla are the biggest builders of EV's (ahead of BAIC) and the Model 3 is by far the highest selling EV.

Agreed it was a major *****up to begin with, Musk is just too ambitious sometimes and needs to be pulled back

I was sort of defending him actually. Whilst statistically insignificant numbers are rolling off the lines (in the grand scheme of planned production) I think the criticism of not meeting target he gets is a bit unfair. Lets see if it reaches full production level.

 

4 January 2018
The Apprentice wrote:

xxxx wrote:

July:30, Aug:75, Sep:115, Oct:145, Nov:345 LAST WEEK in Dec:1,000. 

I.E. Nearly 3 times as many in Nov as Oct, nearly 5 times as many in Dec as Nov. - Exponential growth in my book

So as of now Tesla are the biggest builders of EV's (ahead of BAIC) and the Model 3 is by far the highest selling EV.

Agreed it was a major *****up to begin with, Musk is just too ambitious sometimes and needs to be pulled back

I was sort of defending him actually. Whilst statistically insignificant numbers are rolling off the lines (in the grand scheme of planned production) I think the criticism of not meeting target he gets is a bit unfair. Lets see if it reaches full production level.

 

 

Is it unfair? Let's see how long it takes Jaguar to ramp up production of their electric car when launched..... Something tells me it will be more reliable and better built than anything made by Tesla today and that unlike the model X the doors will close. I'm not a Tesla hater, I admire the work they've done, but as established car makers enter the field and get things like ergonomics right let's see how long they last!

26 January 2018
TStag wrote:

The Apprentice wrote:

xxxx wrote:

July:30, Aug:75, Sep:115, Oct:145, Nov:345 LAST WEEK in Dec:1,000. 

I.E. Nearly 3 times as many in Nov as Oct, nearly 5 times as many in Dec as Nov. - Exponential growth in my book

So as of now Tesla are the biggest builders of EV's (ahead of BAIC) and the Model 3 is by far the highest selling EV.

Agreed it was a major *****up to begin with, Musk is just too ambitious sometimes and needs to be pulled back

I was sort of defending him actually. Whilst statistically insignificant numbers are rolling off the lines (in the grand scheme of planned production) I think the criticism of not meeting target he gets is a bit unfair. Lets see if it reaches full production level.

Is it unfair? Let's see how long it takes Jaguar to ramp up production of their electric car when launched..... ...

But then Jaguar won’t have set a target of 5,000 a week. Set a target of 400 a week and achieve 200 in week 1 and no will bat an eyelid by week 3

typos1 - Just can’t respect opinion

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