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The Production Worries That Tesla Faces

Published by Joe Webster.

What's in this article?
  1. Not Meeting Production Goals
  2. The Model 3 is the Real Test
The Model 3 Is The Real Test

Tesla Motors is arguably the most innovative car company in the world today, with many of the opinion that it is truly shaping the future of automobiles. With the recent unveiling of the Model 3, which is scheduled to be its first economically-priced vehicle at just MSRP $35,000 once it's released, Tesla has continued momentum moving forward. However, Tesla is facing certain criticisms and worries, especially on Wall Street, as one of the main issues that it's facing is in regards to production worries.

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Not Meeting Production Goals.

On April 4th, 2016, Tesla stated that they fell short of their first quarter 2016 sales goals. However, interestingly, the sales miss wasn't due to a lack of demand. Instead, it was due to Tesla's struggles with keeping up with production. During the first quarter, Tesla sold 14,860 vehicles, but its sales projections were 16,000.

The main culprit, according to Tesla, is that they experienced a parts shortage that affected their ability to manufacture the Model X. According to Tesla, their production problems that they experienced stemmed from having a significant amount of technology present within the Model X and, in their own words, "insufficient supplier capability validation, and Tesla not having broad enough internal capability to manufacture the parts in-house (See:"

Furthermore, Tesla claims that it was only 6 parts that they experienced shortages without of a total of more than 8,000 parts that are required to build the Model X. Tesla has stated that they have taken steps to rectify the issue that they faced in producing their Model X vehicles and are still on track to meet their sales goals for the year.

The Production Worries That Tesla Faces

The Model 3 is the Real Test.

Many remain skeptical, despite Tesla's reassurances, that the company will be able to put their production problems behind them. In fact, some believe that the recently-announced Model 3 will only exacerbate them due to demand that has exceeded everyone's, including Tesla's, expectations.Tesla has stated that they want to produce a combined total of 500,000 of their Model S, Model X, and Model 3 vehicles by the end of 2018. Considering that Tesla is only projecting the ability to manufacture 80,000 of its vehicles in 2016, this will be a large ramp up in production.

Tesla has stated that they want to produce a combined total of 500,000 of their Model S, Model X, and Model 3 vehicles by the end of 2018. Considering that Tesla is only projecting the ability to manufacture 80,000 of its vehicles in 2016, this will be a large ramp up in production.

To ensure that they're able to meet the gargantuan demand for its Model 3, as well as the growing demand for its Model X and Model S vehicles, Tesla recently hired Peter Hochholdinger as their new Vice President of Vehicle Production. Hochholdinger held a similar position at Audi, where he was able to streamline and vastly improve that company's production capabilities.

Regardless if Tesla is able to meet its lofty production goals in the future or not, it has the biggest battle already won, which is that its customer demand far exceeds its ability to keep up with it. It's up to Tesla to be able to develop its production capabilities to match its innovation.

Not Meeting Production Goals
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Joe Webster always knew the auto transport industry would be a great career option. And with decades of experience, Joe is now an established consultant for A1 Auto Transport.

Joe was born in Santa Cruz, California. During high school, Joe worked as a mechanic; a job continued to work part-time during his bachelor's degree.

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A-1 Auto Transport is a disclosed agent for the following shipping companies:

CSI Logistics
435 Division Street
Elizabeth, NJ 07201
FMC 22206
Intl Cargo
45 Campus Drive
Edison, NJ 08837
NO. 17858N
Trans Global Auto Logistics, Inc.
3401 E Randol Mill Rd,
Arlington, TX 76011
NO. 018191NF
CFR Rinkens
15501 Texaco Avenue
Paramount, CA 90723
NO. 013055NF
ABC Worldwide LLC
2840 NW 2nd Ave #105
Boca Raton, FL 33431
NO. 025472F
ShipYourCarNow LLC
1160 South Rogers Circle Suite 1
Boca Raton, FL 33487
NO. 025646
Merco Air & Ocean Cargo, Inc.
6 Fir Way
Cooper City, FL 33026
NO. 021869F
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