Good News For Tesla Fans: Model 3 Production Problems Appear Solved
We’ve got a treat for Tesla advocates today. Despite what seems like an attempt to surpass Volkswagen as the automaker to receive the most negative publicity in a single year, there remains a light in the darkness. Tesla may have finally sorted out its production issues with the Model 3.
Logistical problems had forced the company way behind schedule for most of 2018, making its goal of 5,000 units per week an unclimbable peak. But it finally managed to mount that hill and plant its flag in the final week of June. At the time, we had no idea if this was to be an isolated incident stemming from some divine automotive mercy or proof that Tesla had righted the ship.
While it not it did not experience a trouble-free July, the firm’s Fremont factory appears to be humming along at over 5,000 units per week now. What’s better is that analysts are now saying things are only looking up, estimating even higher output numbers in the months to come.
According to reports from CNBC from Thursday, the automaker should be able to maintain a steady production stream and could even ramp production up to 8,000 with little impact on its spending.
“Tesla seems well on the way to achieving a steady weekly production rate of 5,000 to 6,000 units per week,” Evercore ISI analyst George Galliers said after an extensive tour of the company’s facilities. “We are incrementally positive on Tesla following our visit. We have confidence in their production. We did not see anything to suggest that Model 3 cannot reach 6,000 units per week, and 7,000 to 8,000 with very little incremental capital expenditure.”
From what we can tell, Tesla is already on the cusp of 6,000 weekly units. While the end of July saw a severe production slowdown — dropping to approximately 2,500 Model 3s at one point — it managed a comeback and hit over 5,900 cars per week on Sunday morning. That represents almost two months of nearly uninterrupted improvement, if you’re willing to believe July was as successful as claimed. Even if you aren’t, August seems to be going well enough with VIN registrations coming up substantially.
Evercore analysts claimed to be impressed with Tesla’s general assembly in and stamping segments in Fremont, California, which “met or exceeded all the benchmarks which
“From what we saw, it appeared that Tesla’s Model 3 press is able to run two parts together (both right and left door),” Galliers explained. “While we were unable to determine hits per hour, when we asked an engineer, the response was a confident ‘we’re not telling you that but plenty.’ Stamping seemingly has the capacity and capability to support all Model 3 targets and potentially future vehicle models as well.”
Analysts also didn’t have much to complain about in terms of the tented assembly line that’s responsible for finishing the fanciest examples of the Model 3. In fact, it has been an important factor in bolstering overall output.
As optimistic as all this sounds, it’s a separate issue from the apparent breakdown of Elon Musk. The man clearly needs a vacation and to stay off Twitter for a while. Perhaps now that the Model 3’s assembly issues seem to be squared away, he’ll be able to do that. Meanwhile, Tesla can refocus on quality control, this strange privatization issue, important legal battles, and restoring the sanity of its overworked CEO.
“Focusing on the fundamentals and setting aside talk of privatization, we are incrementally positive on Tesla following our visit,” Evercore said in note on Thursday.
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It is one thing to build 5k a week in production; are they selling them? I heard there is a lot filled with Model 3's that aren't sold (or worse, can't be sold because of quality issues).
I went to an electric car show the other day. I was surprised at the uneven panel gaps and seams on a Model 3. Particularly the trunk and frunk. I've seen this before on an X. It doesn't mean they are poorly made or unreliable, but it certainly looks bad.