Electric car company’s worst financial quarter result yet comes from heavy Model 3 production spending amid build woes
The ‘bottlenecks’ which have delayed the delivery of the Model 3 in line with Tesla’s ambitious targets are being addressed, but there are still problems.
Tesla’s 5000-per-week target for Model 3 production has pushed back to late in the first quarter of 2018. Tesla will be clearer as to exactly when this will happen in its next quarterly report. For now, it’s still uncertain when the problems will be alleviated.
“While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp-up such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear,” the company’s latest report reads. Increasing orders for the Model 3 are both helping Tesla and exacerbating the problem.
Tesla’s hesitant outlook comes as it celebrates total production of 250,000 cars since the brand’s birth in 2003, as well as the ever-stronger performance of the Model S and Model X; the two are on track to achieve 100,000 deliveries worldwide across the year. Overall, Tesla’s automotive revenue grew by 10% year-on-year compared with the same period in 2016.
It’s thought that given the level of investment in the production of Model 3, Tesla will likely post more encouraging financial results for investors once production gains momentum.