April 22, 2018

Tesla Model 3 Production Is 84% Lower Than What Elon Musk Promised

04 October 2017, 12:06 | Camille Rivera

I'll have a cup of Musk's

Tesla Coffee

Despite the good news, Tesla failed to meet its production expectations for the Model 3.

In a statement to CNBC, the company said, "It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain".

Tesla has a lot riding on the Model 3, which could be its most popular model if it can make its delivery schedule.

Overall, Tesla delivered 26,130 vehicles in the third quarter, up 4.5 per cent from the same time previous year.

The Model 3 is a more affordable alternative to Tesla's Model S and Model X luxury vehicles.

The moves also followed a series of announcements by rival General Motors on its own electric auto ambitions, which included a promise to take "bold steps" toward the first completely driverless vehicles. Tesla vehicle deliveries represent only one measure of the company's financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.

Musk has often described an "S-curve" for Tesla's production plan in which small batches of vehicles lead to rapid expansion of volume and then level off. And, according to global product development chief Mark Reuss, it will launch two more pure battery-electric vehicles, or BEVs, within 18 months, with a total of "at least 20" to be in its line-up by 2023.

This electric auto maker company also stated that at the end of the third quarter there were 4,820 Model X and S vehicles in transit to customers and would also be counted with its figure of fourth-quarters.

That's because Tesla's slower-than-expected ramp may end up being best for the money-losing automaker, even if it signals a longer wait for Model 3 reservation holders. Musk said Tesla's key advantage in building all-electric vehicles was limiting the number of moving parts. There have been reports that it may consider relaxing rules that require foreign automotive companies to have a local partner, potentially allowing Tesla to manufacture its vehicles in the country. The numbers reduced Tesla's second quarter loss by almost $165 million.

Model 3. Image source: Tesla.

On Monday, the Palo Alto-based company also talked about the production glitches that have come their way.

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