Tesla Model 3 Production Off to a Slow Start

Tesla Model 3 Production Off to a Slow Start

In a letter to investors on Monday, the company said it was behind schedule due to production bottlenecks. As recently as August, Tesla said it was still on a path to average 5,000 Model 3s per week by year's end, a climb that's looking even steeper considering today's report. "We expect Model 3 to have a breakout year in 2019". This can sometimes mean that the cars have a handful of miles, but in this situation, most will likely be Model S 75 sedans that have just come off the assembly line. The market would rather see the Model 3 produced well than have it rushed out quickly to meet delivery targets, said Morgan Stanley analyst Adam Jonas.

"It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain", Tesla continued.

Tesla says it is confident of addressing the manufacturing bottlenecks that have hampered production of its competitively-priced Model 3 electric vehicle. It would have been nice to hear what the current production rate is and perhaps a new forecast for the production ramp. Schools wrote, referring to a conversation that one Tesla employee reportedly had with another worker.

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

"Most auto launches have hiccups, and Tesla is no exception", Adam Jonas, an analyst at Morgan Stanley, said in a note to clients. "You've been through this", he added.




Tesla is building the bank using its commercial battery, the Powerpack, which is being manufactured at the company's Gigafactory in Sparks, Nevada. Although there are bottlenecks with producing the auto in great numbers still, the company remains confident it will significantly boost production next year.

First, the company delivered more vehicles than it produced for the first time in nearly two years. Starting at a baseline price of $35,000, the Model 3 was a bold step towards encouraging more people to try electric power for their transportation.

Price four-door electric vehicle Model 3 in the basic configuration is $35 million, which is nearly half the price at the previous Tesla cars. That included 22,026 cars combined in the second quarter. The third quarter of 2017 was great for Model S and Model X sales; Tesla delivered 14,065 of the former and 11,865 of the latter.

Despite its issues with the Model 3, Tesla said it delivered a record number of vehicles in the third quarter.

Tesla has missed deliver marks on its other stable of electric vehicles.

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