Tesla’s Model 3 was facing some serious production crisis up until April 2018. But thanks to rapid upgrades and necessary changes, model 3 is produced at the rate of 3500 units/week.
What was the production crisis
The production of model 3 began in 2017. The total number of customer deliveries made in 2017 were just only 1,764 units which were less than average per day reservations. Elon Musk, co-founder and CEO of Tesla had set an ambitious target of 5000 of these sedans per week by the end of 2017 which was clearly not achieved. The company then shifted this goal 5,000 cars per week by the end of 2018 and, in January 2018 musk lowered that goal to 2,500 cars only.
As of April, Tesla was producing 2,250 units a week which is still 250 less than the expected goal in January. In an email to Tesla’s staff Musk said Model 3 production should be 3,000-4,000 units per week in May, but again Tesla failed to achieve its goal thanks to the voluntary recalling of 123,000 model S sedan.
During a recent interview with CBS, Musk agreed that his company relied too heavily upon automation. “We had this crazy complex network of the conveyor belt, it was not working, so we got rid of that whole thing.” Musk explained.
Furthermore, Musk who was optimistic about the fully automated production of model 3 stated on Twitter: “Yes excessive automation at Tesla was a mistake. To be precise, my mistake. Humans are underrated.”
‘In final assembly, robots can apply torque consistently—but they don’t detect and account for threads that aren’t straight, bolts that don’t quite fit, fasteners that don’t align or seals that have a defect. Humans are really good at this. Have you wondered why Tesla’s have wind-noise problems, squeaks and rattles, and bits of trim that fall off?’
How it is Improved
“This is the most excruciating, hellish several months that I’ve ever had,” Musk said, his voice breaking. “And a lot of other people at Tesla. But I think we’re getting there,” said Elon Musk during the shareholders meeting about discussing Model 3 production.
The full production of entry-level $35,000 model 3 will begin in the first quarter of 2019 and according to Musk, people have to wait a little longer for the cheaper version of the car.
In his recent tweet Musk said that the Tesla was holding back on making the cheapest version model 3 to generate more revenue. The company is losing money on every Model 3 that it ships despite keeping a target of 25 percent margin on the car.
Currently, Tesla is manufacturing 3,500 vehicles a week on average which is stated by its CEO Elon Musk during a recent shareholder meeting. By this rate, the company’s target of producing 5,000 units per week will be achieved by the end of June.