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Tesla Temporarily Stops Model 3 Production Line (theverge.com) 145

An anonymous reader quotes a report from The Verge: Tesla is temporarily stopping production of its Model 3 electric car, amid a long waiting list and several missed targets. The company, however, says the shutdown is intended to resolve some of the problems that have contributed to the numerous delays in getting the cars to hundreds of thousands of reservation holders. The automaker said Monday it would halt production of the Model 3 sedan for 4-5 days at its Fremont, California assembly plant, BuzzFeed reported. Tesla, however, says this is part of a planned period of downtime that was similar to another shutdown in February, and it isn't intended to have an affect on the company's current production targets for the car. "Our Model 3 production plan includes periods of planned downtime in both Fremont and Gigafactory 1," a Tesla spokesperson told The Verge. "These periods are used to improve automation and systematically address bottlenecks in order to increase production rates. This is not unusual and is in fact common in production ramps like this."
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Tesla Temporarily Stops Model 3 Production Line

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  • by sinij ( 911942 ) on Tuesday April 17, 2018 @09:03AM (#56451295)
    Why such obsession over trivial and routine manufacturing decisions at Tesla? Are we also going to get "Janitors at Tesla factory had to put overtime to unclog plugged toilet" headlines?
    • Depends where the janitors come from.

    • by ausekilis ( 1513635 ) on Tuesday April 17, 2018 @09:22AM (#56451415)

      Because people are genuinely interested in the amount of fiber in Mr. Musk's diet.

      • So would I. The amount of science we could do on the diet of a man who shits pure gold and farts roses is incredible.

    • by Anonymous Coward

      I know, right! The Model 3 is already the best selling (as in actual deliveries) EV. It also outsells similarly priced 4-door ICE competitors like the Acura TLX, Mercedes C/CLA, Audi A4, Lexus RC, and the BMW 2, 3, and 4 series.

      I fully expect WSJ articles soon with articles like "Tesla Manufacturing Impacted by Maintenance: Robot 127E was taken down for maintenance during the second shift at the Tesla factory in Freemont, California during the second shift today. Production was adversely impacted with 7 few

      • I know, right! The Model 3 is already the best selling (as in actual deliveries) EV. It also outsells similarly priced 4-door ICE competitors like the Acura TLX, Mercedes C/CLA, Audi A4, Lexus RC, and the BMW 2, 3, and 4 series.

        I'm assuming you are joking. But in case you aren't, the highest estimate of model 3's that I've seen is just over 17K [bloomberg.com]The Chevy Bolt hit 20K before the end of last year [electrek.co] Nissan has delivered 300K Leafs [forbes.com] as of January of this year.

        • by Rei ( 128717 )

          Why are you mixing together total sales with monthly sales? Here [insideevs.com] are monthly sales. 3820 Model 3s are estimated sold and delivered in the US in March, vs. 1774 Bolts.

          And why are you comparing total production of the Bolt vs. the Model 3 to begin with?

          The Bolt concept car was unveiled in January 2015; pre-production vehicles were seen in testing in mid-2015; the first production car shown at the end of 2015; the production line started making vehicles in fall of 2016; and sales were opened to the public in

          • Toyota Camry, price-and-size comparable to the Model 3, sells around 10X the Model 3. The Honda Accord, also price-and-size comparable, does about 8X the model 3. The Ford Fusion. also price-and-size comparable, does about 5X the Model 3. US sales alone of mid-size cars runs about 150K per month, meaning the model 3 is around 2.6% of the US market. The worldwide mid-size car market is around 500K per month...
      • I know, right! The Model 3 is already the best selling (as in actual deliveries) EV. It also outsells similarly priced 4-door ICE competitors like the Acura TLX, Mercedes C/CLA, Audi A4, Lexus RC, and the BMW 2, 3, and 4 series.

        I fully expect WSJ articles soon with articles like "Tesla Manufacturing Impacted by Maintenance: Robot 127E was taken down for maintenance during the second shift at the Tesla factory in Freemont, California during the second shift today. Production was adversely impacted with 7 fewer Model 3's produced than expected while capacitor C12 was replaced..."

        This argument is flawed. The other manufacturers have model variances to spread their buyers among. Tesla has just three.

    • Re: (Score:1, Insightful)

      by Anonymous Coward

      Why such obsession over trivial and routine manufacturing decisions at Tesla? Are we also going to get "Janitors at Tesla factory had to put overtime to unclog plugged toilet" headlines?

      Maybe because Tesla and Musk constantly demand attention. Heck, Musk installs a few solar panels at one bldg. in Puerto Rico and its an international story. But that's ALL HE DID in PR. Its not like installing solar panels is some great achievement, its been done for decades. Meanwhile, individuals and organizations that did so much more were and are still ignored.

      Maybe also because Tesla is worth billions in market value, but is still burning cash like crazy with no indication they can do anything better t

      • by haruchai ( 17472 ) on Tuesday April 17, 2018 @10:58AM (#56452003)

        "Maybe because Tesla and Musk constantly demand attention. Heck, Musk installs a few solar panels at one bldg. in Puerto Rico and its an international story. But that's ALL HE DID in PR. Its not like installing solar panels is some great achievement, its been done for decades. Meanwhile, individuals and organizations that did so much more were and are still ignored"

        yeah, Tesla Energy only installed at least 6 projects to restore power in Puerto Rico incl at a children's hospital.
        Stupid of Elon to go through all that trouble when all he had to do was toss a few bundles of paper towels, say that everyone was enjoying themselves and we can't do more because of all the bigly ocean water surrounding the island.

    • Why such obsession over trivial and routine manufacturing decisions at Tesla? Are we also going to get "Janitors at Tesla factory had to put overtime to unclog plugged toilet" headlines?

      Pff! What? Nooo... *closes Slashdot submission tab detailing plumbing issues*

      • by sinij ( 911942 )

        Why such obsession over trivial and routine manufacturing decisions at Tesla? Are we also going to get "Janitors at Tesla factory had to put overtime to unclog plugged toilet" headlines?

        Good. Now I can count my today's time on /. toward mandatory court-ordered community service time.

        Pff! What? Nooo... *closes Slashdot submission tab detailing plumbing issues*

    • by Anonymous Coward

      Why such obsession over trivial and routine manufacturing decisions at Tesla? Are we also going to get "Janitors at Tesla factory had to put overtime to unclog plugged toilet" headlines?

      There is clearly an effort underway to sow uncertainty about Tesla by its competitors and also by Wall Street traders hoping to make money on the ups and downs.

      If Tesla can actually ramp up production and make the line profitable that is a huge threat to some very big entrenched interests and the uncertainty about that is a huge opportunity for some Wall Street vulture capitalists.

      I wish Tesla well.

    • by Luckyo ( 1726890 ) on Tuesday April 17, 2018 @09:58AM (#56451611)

      Stock pricing I imagine. There's a lot of people with short term investments in the company.

      This isn't a "janitorial issue" either. This is about Tesla consistently failing to hit production targets by orders of magnitude, with stock that is prices mostly on assumptions of future performance and hence promises. This shut down actually appears to be the consequence of previous Tesla story of them actually managing to increase production to something close to a quarter or so of what they actually promised to deliver. Which followed the reports that this was done in unsustainable way that would force stoppage of production line in near future due to wear and tear.

      Relevance comes from the fact that if even hitting a quarter of production which is needed to just even begin meeting the promises makes the production random inoperable in weeks as appears to have happened here, what is the basis of the stock price of Tesla?

      • by Rei ( 128717 ) on Tuesday April 17, 2018 @11:58AM (#56452405) Homepage

        This is about Tesla consistently failing to hit production targets by orders of magnitude,

        They hit 80% of last quarter's target. Is that "off by an order of magnitude" to you?

        Which followed the reports that this was done in unsustainable

        What BS "reports"? They've maintained the 2k/wk rate since then.

        Yes, they're six months late. Big whoop. Reservations are still at half a million, the "competition" is still a joke, and each of the supposed "Tesla killers" so far has turned out to be half-baked. Exceeding in some cases even my pessimism. I totally didn't call that, for example, the 2018 Leaf would only be able to go 200-300km before being throttled to 20-25kW charge rates. I mean, ouch.

        • by Luckyo ( 1726890 )

          I guess I hit the nerve. Their initial target was far larger than their massive scaled down "last quarter" target, and I was in fact talking about the reason for stock price, which is carried by big promises.

          You also appear to have missed what this story is about.

          And finally, there are bigger and more successful competitors in electric vehicles. BYD for example. They just do the work, and don't over-promise or focus on expensive vehicles only, so they're not in the news every time something happens on their

        • In July 2017, Musk promised to make 5000 Model 3s weekly [theverge.com] in December 2017. We've not seen a sustained 2K/week yet - and it's nearly 4 months late. Producing 3800 in March is around 900 per week - less than 20% of where they were supposed to be last December.
    • Why such obsession over trivial and routine manufacturing decisions at Tesla?

      You really have to ask? The answer's really quite obvious. [wikipedia.org]

    • by Anonymous Coward

      There is good news coming out of China suggesting that TESLA will be able to open a plant in China while still holding control of the company.

      The market weasels want to talk down the stock so they can get a better price as the implications of TESLA opening a plant in China move out into the general investor marketplace.

      Tomorrows headlines will be something like, TESLA to lose all IP and lose key management as a result of internal division and revolt related to horrid plans to build plant in China.

      The percei

    • Short sellers (Score:5, Insightful)

      by Okian Warrior ( 537106 ) on Tuesday April 17, 2018 @10:09AM (#56451689) Homepage Journal

      Tesla is the most shorted [cnbc.com] company right now.

      The problem with the situation is that most investors *want* Tesla to fail so that they can make money from the short sales.

      OTOH, Elon Musk is aware of the shorts and tends to do something to prop up the stock price whenever it drops a little. Like announcing a new model or a new production goal. (The production goals are never met, but the announcements make the stock tick up a couple of percent.)

      So right now we're awash in bear market opinions, and many suggestive (but worthless) statements keep making the rounds such as:

      "Tesla has never made a profit"
      "Tesla loses money on every car they sell"
      "Tesla only survives due to government handouts"
      "Tesla is so far behind that some people will get their cars $SOMENUMBER years from now"
      "Tesla is burning through cash, will be bankrupt in $NUM months"
      "Musk is a serial liar"

      Those are the highlights - have I missed any?

      To analyze #4 as an example ("burning through cash"), note that this is something the CFO and CEO keep track of and anticipate, and are responsible for raising more cash before the bankruptcy actually happens. Also, specifically Tesla predicts that they won't need another round of financing, but that option is certainly open if they need it.

      It's nigh impossible to get an accurate assessment of Tesla's worth right now, due to corruption in reporting.

      Tesla expects to turn a profit for the first time later this year. Their stock will probably skyrocket when that happens.

      • by es330td ( 964170 )

        Also, specifically Tesla predicts that they won't need another round of financing, but that option is certainly open if they need it.

        Musk had to say this. The cash burn at Tesla is factual and well known so any shareholder rightly cares if Tesla can pay its bills. When a company doesn't make a profit the only way to keep the doors open are borrowing or selling shares. Tesla's long term debt currently trades at a substantial discount to face value so the bond markets are saying they don't believe the hype and don't really want to lend to Tesla. If Tesla can't borrow then they have to sell shares. At depressed stock prices, any meaningful

        • Cash burn is utterly irrelevant. Tesla can't go broke, so it can't go bankrupt. They've a half million cars on order at at least 50K each. That's 25 billion in gross sales, and that's *past* orders. Present orders are being held back because they can't make cars fast enough to immediately deliver.

          At 25 billion coming in, they have all the lines of credit and investor interest they will ever want.

          China just let them own their own factory there. That's...enormous news.

          Cash burn is a concern if you can't pay y

          • Oh, gawd damn it. 2 and a half billion. Do not use your head for a calculator. Still, that's conservative. Call it 3-4 billion because most of those cars will cost more than 50K.

      • "Tesla loses money on every car they sell" "Tesla only survives due to government handouts"

        I have always wondered about these arguments. I haven't looked at Tesla's P&L recently (in spite of being a stockholder) but I was under the impression that they are plowing tons of money into R&D.

        So if they wanted to suddenly be profitable all they would have to do is stop spending on R&D. Just bank the gross profit they get off of selling their existing product which is heavily in demand.

        So what would their stock be worth if they did that?

        • by Rei ( 128717 )

          I was under the impression that they are plowing tons of money into R&D.

          They are. About 1 1/2 billion per year. Versus their Q4 loss of under $600M. Their SG&A is also scaled up in advance of the 3 rollout, since you can't magic that into existence the instant production increases. Tesla has big capex also. Interestingly, there are clear signs that Tesla is increasing (or preparing to increase) capex. They're currently relocating the Gigafactory parking lot (first step to expand the building) a

      • by rtb61 ( 674572 )

        You fail to mention that shorts also articificial reduce a companies share price, however the problem with shorts is that if people push up the price to a certain point those shorts are forced to buy the stock at a much higher price than they sold it for. Shorts are also most often leverage, so they pay around 10% of the value of the shares they short and of course if shares prices go 10% higher than the price they pretended to sell at, the finacing broker forces them to buy at the new much higher price to

      • by jeremyp ( 130771 )

        Tesla's stock is massively overpriced given its current revenue and production. That's not talking down the price , it is stating a fact.

        General Motors has revenue of about $148 billion and a market cap. of around $40 billion

        Tesla has revenue of $12 billion and market cap. of about $50 billion.

        Neither company makes a net profit, however Tesla is apparently worthy more in spite of have less than a tenth of the income. It's overpriced.

        • Neither company makes a net profit, however Tesla is apparently worthy more in spite of have less than a tenth of the income. It's overpriced.

          Huh? GM's EPS is $5.15 and at its current share price pays a dividend with a 3.87% yield. Tesla has the dubious honor of increasing its losses per share even as share dilution increases.

      • Elon Musk is aware of the shorts and tends to do something to prop up the stock price whenever it drops a little.

        Alternatively, if Tesla wasn't going to need to issue more stock for cash any time soon, he could just let the shorts happen and then buy more shares at a lower price. If he believed in Tesla that is.

      • The problem with the situation is that most investors *want* Tesla to fail so that they can make money from the short sales.

        Most investors want to make money, long or short. If they thought they could make the most money by going long on Tesla, there's no reason they wouldn't. But the fundamentals point to going short being the better move, so they're selling it short - not out of spite, but out of analysis.

    • by Octorian ( 14086 ) on Tuesday April 17, 2018 @10:13AM (#56451719) Homepage

      Why such obsession over trivial and routine manufacturing decisions at Tesla? Are we also going to get "Janitors at Tesla factory had to put overtime to unclog plugged toilet" headlines?

      Because Tesla is a heavily shorted stock, and has started to return to the "good news" phase of the cycle.
      Whenever a stock is heavily shorted, good news that increases the stock value must be immediately followed by a series of damning articles to make the stock value drop again.

      So if Model 3 production was completely on-track, and there was nothing else bad to report about the company, you absolutely would see a front-page article on the terrible toilet problems that were causing issues at the factory. (Often, but not exclusively, originating from a place like "Business Insider" or "Seeking Alpha" from an author who quietly admits to have a short position on TSLA and a long position on competitors.)

      • Also a good time for the "analysts" to buy cheap, so the drumbeat goes on to drive the stock price as low as it can go.

    • I expect it is Musk takes a Tech Sector approach towards its products (High Automation, Smart Software, ). Many of them such as Automobiles already have an industry with its own sets of standards and best practices behind them. So it is interesting to see what manufacturing changes stay and what roles back to the traditional tried and true method. They are camps that wants to see these new methods succeed (because these new manufacturing methods can put America back to manufacturing again, by reducing th

    • by Jodka ( 520060 )

      Why such obsession over trivial and routine manufacturing decisions at Tesla?

      Two reasons:

      First, anything which seems like it could possibly be construed as a setback is cited by the Tesla haters as evidence that the company is certainly doomed to fail. Some conservatives, because they oppose government subsidies and are skeptical of the forecast (and Gore-cast) AGW apocalypse, by association despise Tesla and talk it down at any opportunity. Of course, Tesla is long-term bet on the profitability of mass-producing smart electric cars. Growing pains, such as deviations from forecas

    • "Routine manufacturing decisions"?

      If this were Ford or Kia, two companies that have produced millions of cars in more than a dozen models, a temporary shutdown of a production line of one model would be more routine, but this is Tesla -- a company that's still not profitable and that has missed several deadlines for its Model 3 "mass-production" vehicle.

      So yeah, it is a big deal.

      Not to mention potential buyers have plopped down $1,000 to reserve one of these cars (OK, I mentioned it)

  • They must need to shut shut down the line to let those robots cool off from that air friction!
  • the shutdown is intended to resolve some of the problems that have contributed to the numerous delays

    Translation: They put everything they had into the last couple of weeks in the first quarter to make the numbers look less bad. Now they're out of parts.

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