Tesla Motors is gearing up to manufacture 5 lakh Model 3 cars in 2018.
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In Tesla’s latest earnings call, the automaker announced that it plans to push its timeframe to reach 500,000 vehicles up from 2020 to 2018.
Still, Tesla affirmed its previous guidance for 80,000 to 90,000 deliveries for the full year.
As a result of the increased focus on quality control overseen directly from Musk himself, Tesla was able to increase production volume of the Model X by five-fold from 507 units in Q4 to 2,659 in Q1.
The aggressive push is a response to the widespread interest in its mass-market Model 3, which Tesla claimed was “the biggest consumer product launch ever”. That number will include the Model 3, due in late 2017 with a sticker price starting at $35,000.
Extremely strong demand for Tesla’s Model 3 – a $35,000 sedan unveiled in March and meant to be Tesla’s first mainstream vehicle that has booked more than 400,000 pre-orders – is partly behind the production ramp up. An announcement made today says that two top-level managers in charge of production and manufacturing are leaving the company, suggesting a personnel revamping might also be on the cards.
The company’s share prices seesawed during the day, falling 9.76 percent by the close, then rising again in after-hour trading once Tesla issued its update.
Was Reichow’s departure linked to Model X glitches?
Revenue rose to $1.15 billion from $939.9 million.
Reichow and his team “deserve a lot of credit for building an all-new manufacturing organization from the ground up and for making Model S and Model X a reality”, Tesla Chief Executive Elon Musk said in a statement.
No small undertaking, the massive scale-up would see Tesla produce almost five-times more vehicles per year than it has produced in its entire history beginning in jut two years.
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Lately, Musk said he has been spending nights camp-out style behind his desk near the end of the assembly line of Tesla’s factory in Fremont, Calif. Despite beating the consensus estimates and upgrading its long-term production/deliveries plans, the Street remain bearish on the stock on doubts over the CEO Elon Musk’s optimism and potential capital raise in the near future. Tesla is well below those numbers now and faces a number of challenges for amping up production.
