Tesla’s (NASDAQ:TSLA) Elon Musk Deep in Production ‘Hell’
In the automotive sector time is money, Mr. Musk seems to think he has lots of both, he does not!
Tesla (NASDAQ:TSLA) has suspended its Model 3 assembly line in what the company was a planned production halt, the EV continues facing major production problems ramping up its most important car..
This is at least the 2nd time since February that Tesla has shut down its production line for the Model 3 at its Fremont, California plant.
“These periods are used to improve automation and systematically address bottlenecks in order to increase production rates,” a Tesla representative said explaining away the hellish production issues Monday.
There have been many delays in production of the Model 3, and Tesla is forever trying to catch up to a target of building 2,500 vehicles per week by the end of Q-2.
People say that the problems exist within its virtually untested heavily robotized assembly line have complicated the overall production.
Last Friday, CEO Elon Musk acknowledged for the 1st time that he had over-relied on automation in the Model 3 assembly line, a major admission from him as he previously thumbed his nose, rolled his eyes and smirked at the major auto makers manufacturing prowess and bragged about creating an “Alien Dreadnought” within the Fremont factory by Y 2018.
That was hyperbole and the sector and its desenting Tesla analysts have been proven right.
“Yes, excessive automation at Tesla was a mistake,” Mr. Musk Tweeted Friday. “To be precise, my mistake. Humans are underrated.”
He also Tweeted Friday that Tesla would be profitable and cash flow positive in the 3rd and 4th quarters, with no need to raise money.
Meanwhile, stacks of Tesla parts have been seen stacked outside of various machine shops in and around San Jose, CA.
Automotive sectors analysts dispute Mr. Musk’s analysis, which hinges on a rapid rise in production of the Model 3 sedan. Delays and lower-than-expected volume have postponed revenue from cars being delivered to customers from reaching Tesla’s bottom line.
Shares fell 3% Monday.
Also, there is a report alleging that Tesla under-counted worker injuries, and an amended lawsuit originally filed last year alleging CEO Musk misled investors about his Model 3 production.
Last February, Tesla suspended production of its Model 3 for 4 days in what it said was planned work to adjust equipment in order to improve automation and address bottlenecks. It warned of possibly more periods of downtime in coming months, they are here and now.
Note: Main line automakers stop or slow production of new models to iron out kinks within the production system. The auto community knows that Tesla took shortcuts with the testing of its production line in order to get to market more quickly, shortcuts that experts say resulted these Key manufacturing problems
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