Can Elon Musk Fix Tesla Model 3 Production Woes Anytime Soon?

Tesla seems to be struggling with mass-production of its first mass-market car, the $35,000 Model 3. Just three days after CEO Elon Musk said in a tweet that “excessive automation” of the company’s production line was a mistake, the company put the manufacturing of Model 3 on hold for some days, and a spokesperson said the reason was to “improve automation.”

When production of the Model 3 sedan began in the second half of 2017, Tesla was targeting rolling off 5,000 vehicles every week by the end of the year. But that deadline has been pushed and reaching that number looks likely to miss its current June-end deadline as well.

In an interview to CBS News during a tour of his factory, Musk said Tesla had reduced its reliance on automation in the Model 3 production line, and that the company had been making over 2,000 of those cars every week.

“We’ll probably have, I don’t know, a three or four-fold increase in Model 3 output in the second quarter,” he had added.

But instead, there is a pause in production. It is not unusual for production lines to be put on hold for maintenance or upgrades, but in the case of Model 3, it was perhaps largely due to Tesla putting in too much technology into the new car, all at one time instead of doing it in stages. Even before Musk said as much in the CBS interview, he said so in response to someone on Twitter who was asking for a dual motor version of the Model 3.

Musk also said in a tweet immediately after that it could probably be done by July, so his own approximation for the ramp-up of Model 3 production was still in line with the company’s estimate. But having personally taken over the production line of Model 3, the two estimates should not really be divergent.

An unofficial estimate of Model 3 production by Bloomberg said Tesla had produced 16,823 vehicles by April 16, and that production rate as of that date stood at 2,688 cars a week. Tracking the production on a graph shows an upward curve that could, if it continues, lead to a sudden jump in output. And given the fact that Musk did not specify an actual number, but only said Tesla was making over 2,000 Model 3 cars every week, it does not provide any more clarity.

However, Musk seems confident, like he usually does, about making it through. In a tweet the same day the CBS interview aired, Musk said — responding to a story in the Economist — Tesla would be profitable and cash flow positive by the end of the ongoing quarter.

Meanwhile, reserving a new Model 3 now has a delivery wait time of “12 to 18 months,” according to Tesla’s website.

Investors seem to be worried, if stock prices are anything to go by. During Monday trade on Nasdaq, Tesla shares fell 3.04 percent, and lost another 0.24 percent during after-hours trade. In contrast, other carmakers closed Monday trade on a positive note, with General Motors and Ford rising 0.84 percent and 1.14 percent, respectively, on the New York Stock Exchange.