Tesla Trouble Continues As Head Of Production Quits

Tesla’s production woes are not yet over as one of its major executives recently tendered his resignation, adding another hurdle to the company’s vehicle turnover problems.

According to a Reuters report, Tesla’s Peter Hochholdinger, the vice president of production at its Fremont factory, resigned after three years with the EV brand. Hochholdinger worked as a production executive of Volkswagen AG before transferring to Elon Musk’s company.

The resignation comes amidst Tesla’s current problems in ramping up the production of the Model 3, arguably the company’s best-selling vehicle. The success of the Model 3 plays a crucial role in the company’s long-term plans and profitability.

The former production VP was initially tasked to help improve production ramps of Tesla’s luxury line which includes the Model S sedan and the Model X SUV. In his appointment memo, Hochholdinger was also given the role of improving the Model 3’s manufacturing program in hopes of building a cost-effective production line for the EV model.

Tesla’s production problems are said to be so severe that Musk tweeted that he would be “working on Tesla global logistics” for his birthday.

In a report, Tesla’s chief engineer was said to have sent employees a short memo that the company is set to complete a record for quarterly deliveries, but they are having trouble with shipping vehicles to specific destinations.

Adding to the company’s woes are demand problems that are currently being marred by the ongoing U.S. vs. China trade war. Tesla lost millions of dollars or approximately 31 percent in its first-quarter earnings report. Because of this, Musk said that profits for the company would be delayed until the latter half of 2019.

This is why the company is working doubly hard to deliver a record number of EVs for its Q2 target. Musk is confident that they will be able to achieve the numbers despite reports saying that Tesla will be facing delivery bottlenecks before Q2 ends.

Early this week, Wedbush analysts changed the quarter delivery forecast to less than 4,000 units. The firm initially set turnover at 88,000 units but said that Tesla hitting the mark this quarter in an “unlikely event.”