Elon Musk has a problem… well a few problems, actually. Production on its messianic Model 3 is worse than terrible.

Electrek.com reports that as Tesla CEO Elon Musk made clear during the company’s conference call with financial analysts last week, Model 3 production is still very much in “production hell” – so much so that Musk refused to confirm how many Model 3 vehicles they produced in October.

He said that “people would just read too much into it.”

Now we have looked into it and at the end of last month, Tesla had built just over 440 Model 3 vehicles since the start of production in July, according to sources familiar with the matter.

It means that Tesla built roughly 180 Model 3 vehicles last month. That’s clearly not where Tesla wanted to be at that point.

Tesla highlighted batteries, body-shop welding and final assembly as production bottlenecks. It walked back its 2Q claim that Model 3 gross margin would go positive in 4Q, now expecting it to reach breakeven by end of that period. Tesla previously guided toward positive 2H cash from operations.

Because it’s building them by hand.

Tesla’s warning about “production bottlenecks” might not be its last as Elon Musk’s dream of building millions of the “everyman’s electric car” melts before his eyes. 

Unknown to analysts, investors and the hundreds of thousands of customers who signed up to buy it, as recently as early September major portions of the Model 3 were still being banged out by hand, away from the automated production line, according to people familiar with the matter.

While the car’s production began in early July, the advanced assembly line Tesla has boasted of building still wasn’t fully ready as of a few weeks ago, the people said. Tesla’s factory workers had been piecing together parts of the cars in a special area while the company feverishly worked to finish the machinery designed to produce Model 3’s at a rate of thousands a week, the people said.

Print Friendly, PDF & Email