Tesla (NASDAQ:$TSLA) has a lot of things going on at the moment, but the end goal is and will continue to be, that its Model 3 vehicle – which is priced at $35,000 – will make electric vehicles America’s main form of transportation. Unfortunately, it’s off to a slow start.
In case you missed it, Tesla announced on Monday, October 2, that it produced a mere 260 Model 3s at its Fremont, California plant in Q3. This is significant news as it is well short of CEO Elon Musk’s plan to roll out 1,600 Model 3 vehicles by the end of the month.
Seeing as Tesla is behind schedule, the Palo Alto-based company is going to have to push harder to achieve its goal of manufacturing 5,000 Model 3 vehicles per week by the end of the year, and at least 500,000 vehicles of all models annually by next year. In total, Tesla delivered 26,150 vehicles in Q3, which is up 17.7% from the same period in 2016.
Tesla has yet to manufacture more than roughly 100,000 cars in a single 12-month period. Critics have not shied away from pointing out that the company’s rush to ramp up production puts the company at risk of delays and costly recalls if quality issues were to surface.
What caused the Model 3 delays? Well, according to Tesla’s October 2 investor letter, the delays were caused by “production bottlenecks” from manufacturing subsystems taking longer to activate than forecasted. “It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain,” Tesla said. “We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near-term.”
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