Friday, April 20, 2018

Tesla Adds 3rd Shift to Model 3 Production in Push to 6,000 Vehicles/Week Run Rate

Tesla Model 3 front three quarters (Credit: Tesla) Click to Enlarge.
An internal email from Tesla CEO Elon Musk to all Tesla employees was obtained by Jalopnik and provides insights into Tesla’s progress to date on Model 3 production rates as well as the path forward for Model 3.

Progress to Date
Tesla noted in its first quarter earnings call that it had (barely) achieved a weekly production rate of 2,000 cars per week by the end of the quarter.  As always, deliveries trail the production numbers, and given that this rate was only hit at the end of the quarter, that wasn’t registered in the final deliveries.

In the leaked email, Elon shared that the team had continued its progress to increase the production ramp and has exceeded the current target of 2,000 cars per week for three successive weeks in a row for the last 3 weeks — at 2,020, 2,070 and 2,250 cars per week, respectively.  While this does not demonstrate sustainable production rates, it does show that Tesla is truly “burning the midnight oil to burn the midnight oil” as Musk puts it in the email.  In other words, the company continues to work hard ratcheting up Model 3 production.

These rates will suffer in April, as Tesla is planning to shut down Model 3 production lines to upgrade them in order to enable faster run rates, with another similar outage planned in the coming months as well.  This downtime won’t come as a surprise to anyone who has worked in manufacturing plants where downtime is not just expected on new lines but planned.

This expectation is further compounded by Tesla’s divergence from traditional automotive manufacturing methodology, which typically tests equipment out in “soft tooling” runs before installing hard tooled equipment.  Tesla cut soft tooling out of its process, essentially skipping the beta testing phase in order to trim up the schedule — and the budget.

Additionally, Tesla has not only designed the Model 3 for production — it spent significant capital acquiring Grohmann Engineering in Germany and Riviera Tool & Die in Michigan (now known as Tesla Michigan now) in order to design the “machine that builds the machine” to optimize production as much as possible.

Read more at Tesla Adds 3rd Shift to Model 3 Production in Push to 6,000 Vehicles/Week Run Rate

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