Can Elon Musk Solve Tesla’s Production Problems?

No one would question Elon Musk’s credentials as a visionary. From a network of satellites providing high-speed wireless access to the entire world, to  a vast network of tunnels making traffic a thing of the past, to building a colony on Mars, Musk seemingly has no end of ideas that he does not hesitate to try and turn into reality. However, the execution part is where things become slightly trickier. By and large, SpaceX’s recent Falcon Heavy rocket launch was a resounding success, putting Musk’s personal Tesla Roadster into orbit, demonstrating the might of the most powerful operational rocket on Earth, and sending conspiracy theorists into a tizzy. However, dampening the excitement around SpaceX’s successes are reports of Tesla’s continued shortcomings in the production space.

[brightcove video_id=”5735401816001″ brightcove_account_id=”3653334524001″ brightcove_player_id=“rJs2ZD8x”]According to Tesla’s most recent quarterly report, the electric car company is still deep in production hell, falling well short of the initial production goals they laid out for those who pre-ordered the Tesla Model 3. The company initially planned to produce 5,000 Model 3 units per month by the end of 2017, but has had to revise that goal multiple times. The most recent earnings report indicated Tesla was now planning on reaching the 2,500 units/week manufacturing goal by the end of March, with 5,000 coming by the end of the second quarter. Bloomberg has taken things a step further by creating a Model 3 tracker that analyzes vehicle identification numbers (VIN) and claims that Tesla has manufactured 7,341 Model 3s since production began, and it is currently hitting a mark of roughly 1,025 units per week.

Image: Tesla

The biggest limiting factor in Model 3 production is battery pack production, which largely takes place at the Gigafactory facility in Nevada. “Module production is the limiting factor in Model 3 production, which is ironic because that should be the thing we’re best at,” Musk said to investors on the earnings call. Coming off of a loss of $675 million—with potentially more to be spent this coming quarter—this news may be a hard pill to swallow for many investors. At $35,000, the Model 3 sedan is crucial to Tesla’s success going forward because it makes electric cars seem more affordable and less of a luxury. However, if supply cannot keep up with demand, then their investors may turn tail and run, and without a continued cashflow, we can say hasta la vista to continued innovation from Musk and Tesla in the electric vehicle space. But, as they say, Rome wasn’t built in a day, and neither was a fleet of relatively affordable, high-tech electric cars. As with many things that spring from Elon Musk’s mind, the Model 3 certainly seems like it will be worth the wait.

But wait, there’s more! Today’s episode of Muskwatch also brings you the latest on how solar energy is revolutionizing the energy markets in Australia, gorgeous new photos of the Kuiper Belt taken by NASA’s New Horizons spacecraft, and much more!

Muskwatch airs on and  YouTube every Tuesdaybut you can hack the planet and watch it two full days earlier on Sunday if you’re an  Alpha subscriber. Find out how you can get 30 days free (and be 48 hours smarter than your dumb friends)  right here.

What do you think of this week’s top stories? What else would you like to see us discuss on Muskwatch? Let us know in the comments below!


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