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Tesla falls behind on production of its 'mass market' electric vehicle

04 October, 2017, 00:28 | Author: Samuel Sharp
  • CEO of Tesla Elon Musk is seen delivering speech at the wind and solar battery plant outside of Jamestown South

In the third quarter, Tesla delivered 26,150 total vehicles and just 220 Model 3 cars versus the FactSet estimates of 25,860 and 1,260, respectively.

It says "production bottlenecks" are the reason behind it's less than anticipated delivery of its cheapest electric auto, but emphasised there would be "no fundamental issues with the Model 3 production or supply chain".

Tesla shares declined 1.2 percent in early trading Tuesday.

Tesla said most of the lines at the Gigafactory, its battery plant in Nevada, and its auto assembly plant in California were meeting their production targets, but that "a handful have taken longer to activate than expected".

Production ramp-up has always been a weak spot for the company, and, in 2015, the Model X exposed Tesla's struggles with quality control most clearly.

Jonas believes Tesla when it says it can fix the bottlenecks.

While the exact calendar boundaries are indeed arbitrary in terms of vehicle manufacturing, that doesn't detract from the highly ambitious, and risky nature of Tesla's Model 3 production goals.

Tesla Model 3 production target has been missed by a significant margin which could be problematic for the electric auto manufacturer.


September was supposed to be the Model 3's big month.

Autotrader analyst Michelle Krebs opines that it will only get worse with the Model 3, the first vehicle that Tesla will produce for the mass market.

Second, it raised sales guidance for its established Model S and X vehicles.

Model 3 only started production in July and orders have topped 450,000 vehicles, he said. That means the automaker will need to push harder to achieve its goal of building 5,000 Model 3 vehicles per week by the end of 2017, and at least 500,000 vehicles of all models annually by 2018.

Such problems don't seem to be an issue for its older S and X models, however, as Tesla reported that it produced a total of 14,065 and 11,865 of the EVs, respectively. The remaining 220 were Tesla's recently launched Model 3.

Tesla struggled to produce its cheapest model shortly after the auto debuted, setting back Chief Executive Officer Elon Musk's mission to reach mainstream consumers.

With its vast footprint and production capabilities, the Gigafactory in particular will be vital in scaling up the Model 3's numbers.

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