Musk expressed confidence the company would figure out how to scale up its production capacity, predicting it will produce 500,000 vehicles by 2018, two years earlier than previously expected.
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Electric vehicle maker Tesla Motors Inc brushed off a big first-quarter loss and cheered investors with news that it plans to accelerate its production plans. Company shares rose more than 5 percent just hours after the first quarter results were announced and increased production targets. It wants the $35,000 Model 3 – which has received more than 325,000 pre-orders since it was unveiled in March – to start rolling off the assembly line in late 2017.
“No element of Model 3 can be approved unless manufacturing says it’s easy to manufacture”, Musk told analysts in a conference call Wednesday evening. First-quarter deliveries were nearly 50% more than a year ago. The automaker made a name for itself with two $70,000-plus luxury models – the Model S and Model X. But a successful mass market vehicle is the cornerstone of Musk’s plan to grow the company. “Increasing production five-fold over the next two years will be challenging and will likely require some additional capital, but this is our goal”, the company said in a statement.
Tesla also indicated that orders for its Model S vehicle have risen 45 per cent year-over-year, with a 160 per cent increase in Asia. Greg Reichow, Tesla’s vice president of production, and Josh Ensign, vice president of manufacturing, will leave the company, the story said.
Tesla CTO JB Straubel said the Model 3 was created to facilitate the manufacturing, but we are still talking about 6,000 to 7,000 unique components in the vehicle.
“My belief in Tesla’s ability to successfully deliver great cars and inspire the world to drive electric remains as strong as ever”, Mr. Reichow said in a statement. All eyes are now on Tesla to see whether it can deliver on its promise to bring its new Model 3 out on time. He will remain at Tesla until a successor is found, Tesla said. Bloomberg also cited an anonymous source saying that glitches in the launch of the Model X were tied to the executives’ departures, though Tesla denied this.
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A severe shortage of parts for the Model X in January and February as well as quality issues for the SUV were blamed for the shortfall.
