Did Tesla Hit Its Model 3 Production Goal Last Month?

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Tesla in the remaining days of the second quarter managed to hit its production goal of 5,000 Model 3 sedans per week, albeit only barely.

By building more than 5,000 of the sedans in the last week of the second quarter, Tesla "just became a real auto company", the chief executive officer said in an internal email Sunday obtained by Bloomberg News. "What an incredible job by an wonderful team".

The Spice. Must. Flow.

He also wrote that the company had produced 2,000 of its luxury Model S and Model X cars, bringing total vehicle production to 7,000 over the course of a week. "But he also warned at the time that Tesla was entering at least six months of "manufacturing hell" as it tried to hit the targets".

In the past, Tesla has said that it's been able to boost production by idling its factories for short periods of time to address bottlenecks and upgrade equipment.

To meet its goal, Tesla had set up a new production line inside a tent on the campus of its Fremont factory.

The future of #Tesla hinges on this very big tent.

In a very tangible sense, Tesla views its production line as a laboratory for untested techniques. @elonmusk wants to pump out 5K #TeslaModel3 per week.

"We did it! We either found a way or, by will and inventiveness, created entirely new solutions that were thought impossible". Perhaps most surprising is that the total cost of production in the Sprung tent is lower.

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That is a sentiment shared by Dave Sullivan, manager of product analysis at market research firm AutoPacific Inc. Tesla looks to be trying to get out ahead of any speculation around quality of the latest batch, specifically those produced on the GA4 "tent" line. "I don't think producing 5,000 once is anything to get excited about until it's repeatable". "These cuts were nearly entirely made from our salaried population and no production associates were included, so this will not affect our ability to reach Model 3 production targets in the coming months".

In an internal email announcing layoffs last month, Elon Musk wrote that Tesla needs to become "sustainably profitable" in order to achieve its goal of accelerating the transition to clean energy technologies. That figured also overshadowed the combined production of the Model S and X, which stood at 24,761.

In its statement, the company said the new line was responsible for 20 percent of Model 3 production last week, or about 1,000 cars.

Tesla has begun producing more expensive versions of the Model 3, including the Performance model, which can top out at $80,000, a little more than the price of an entry-level Model S.

This break occurs several months after Field was removed from his position as head of Model 3 production and replaced by Elon Musk.

Production issues surrounding the Model 3 - heralded as Tesla's first "mass market" auto - have plagued the company since the vehicle's launch.

It's not clear how numerous 450,000 who put down a $1,000 refundable deposit did so on the basis of the $35,000 asking price. Investors have closely watched the Model 3's development, considering it an important opportunity for Tesla to reach a broader market.

That puts companies such as Ford and Tesla at a disadvantage to European and Asian manufacturers.