Tesla Model 3 Production Lags as Gigafactory Hits Delays

03 November 2017, 12:17 | Shawn Tate

Not until 2020 – comments by Musk on Tesla’s Shanghai factory hit suppliers’ and property stocksMore

Not until 2020 – comments by Musk on Tesla’s Shanghai factory hit suppliers’ and property stocksMore

Shares of Tesla (NASDAQ: TSLA) fell as much as 8.9% on Thursday, in the aftermath of the company's third-quarter earnings release.

The mass market Model 3 is a make-or-break auto for the company, which until now has sold luxury cars. According to the company's Q3 report, it has only managed to build 260 Model 3 vehicles, well below the 1,500 that had been planned by September.

Less than four months later, however, it's clear that things haven't been running as smoothly as Tesla and its CEO Elon Musk would like. The company's goal to produce 5,000 Model 3s a week in December has been pushed back to the end of the first quarter. $304.08's average target is 1.16% above currents $300.59 stock price.

The US$35,000 Model 3 - which is half the cost of Tesla's previous models - could move Tesla from a luxury niche automaker into the mainstream.

"(1) What is happening to demand for the product? Indeed, the company's target of 2,000 Model 3 units being assembled in the third quarter was missed badly, with only 236 actually produced.

TESLA Inc's first attempt at high-volume production isn't going as well as it hoped - and the company has a record quarterly loss to show for it. "Discussion of future cash flow was characteristically vague but the CFO emphasized that the eventual Model 3 ramp will be accompanied by substantial operating cash flow".

Puerto Rico governor demands cancelation of Whitefish power contract
There will be a separate audit by the Department of Homeland Security's Inspector General's Office. The Puerto Rican government admitted that 911 people had died of "natural causes" after the storm.

Taylor Swift's new music video promo uses the 'Batman Forever' font
As RadarOnline.com has learned, the star shared a teaser for her "Are You Ready For It? " music video this Monday on Instagram . Swift appears in the video wearing a nude colored body suit, but some media outlets are reporting that Swift is actually naked .

Mayor launches T-Charge
The charge has been introduced in an effort to improve air quality in the capital, where legal pollution limits are regularly exceeded.

The company said it had US$3.53 billion in cash and cash-equivalents as of September 30, compared with US$3.04 billion at the end of the second quarter. Around that time, he adds, driverless cars should be gaining traction, and he expects Tesla to assume a leading position in this technology.

Tesla also admits that because "the Model 3 production process will be vastly more automated than the production process of Model S, Model X [.] bringing this level of automation online is simply challenging in the early stages of the ramp". Musk threw blame at a subcontractor who "really dropped the ball". He said Tesla wasn't aware of the extent of the issues until very recently, and the company's engineers had to scramble to rewrite software from scratch to compensate for the contractor's error.

Putting a ballpark figure on production capacity, Musk indicated somewhere in the neighborhood of "at least a couple hundred thousand vehicles per year, maybe more". Insiders have sold 50,992 shares of company stock valued at $17,390,505 over the last ninety days.

"We see additional capital needs to deliver Model Y by late 2019 (~$3-6bn Gigafactory/assembly plant) in addition to the cash needed to expand its dealerships and charging stations". A lot of outside companies get into such partnerships to avoid the 25% import tax that's levied on foreign carmakers, but Tesla seems to want to do this independently.

Energy generation and storage revenues soared from $23.3 million in the third quarter of 2016 to $317.5 million in the reported quarter.



Other News

Trending Now

Mobile And Sprint's Planned Merger Is A No-Go
The decision was made 30 October to call the talks off, and Deutsche Telekom would be informed the following day, the report said. These two companies came close in 2014 about the merging, but later due to some regulatory concerns called it off.

Sprint reportedly calling off T-Mobile merger talks
The two firms had held talks in 2014 on a merger but ended discussions in the face of opposition from USA regulators. Deutsche Telekom shares were actually slightly up , so European traders may think the company dodged a bullet.

The first charges have been filed in special counsel Mueller's Russian Federation investigation
The president has repeatedly denied potential collusion as "fake news" and a "hoax" perpetuated by Democrats. After Comey's ouster, Deputy Attorney General Rod Rosenstein appointed Mueller to lead the investigation.

Mourinho explains shut-up gesture after Manchester United vs Tottenham
There was nothing fancy about Martial's victor , the forward finishing after a kick downfield by United goalkeeper David De Gea was headed on by Romelu Lukaku .

Harvey Weinstein accused of rape by actress Natassia Malthe
Once inside, she said Weinstein took off his trousers and sat on the bed. "I was feeling panic and wondering what I should do". The actress began the interview praising the over 60 women who have joined her in coming out publicly against Weinstein.

Cabinet go-ahead for mega highway plan
While further talking about it, he added, "Bharatmala will lead to significant improvements in road safety and save lives". Bharatmala will integrate Bangladesh-Bhutan-Nepal and Myanmar-Thailand corridors to make a North-East hub of East Asia.

Gujarat's maritime development a 'model' for entire nation: PM Modi
After the inauguration of the Phase 1 of the service, Modi travelled in the Maiden voyage of the service from Ghogha to Dahej. We are planning to link other places also through ferries. "This ferry service will not be restricted to this one route".

Ovechkin, Capitals rally for OT win against Red Wings
The Red Wings' negotiations Athanasiou's agent had been gridlocked for the entirety of the National Hockey League offseason. Athanasiou, who was a restricted free agent this summer, was seeking a two-year deal worth around $2.5 million per season.

Meghan Markle & Prince Harry Had a Secret Tea Party With the Queen
It's believed the meeting was held in the Queen's private sitting room at around 5pm and Prince Philip was not in attendance. As Meghan has been married before, Harry must ask the Queen for her permission to Wednesday the brunette star.

Shooting in Harford County business park
Harford County Sheriff Jeffrey Gahler identified the alleged shooter Wednesday morning and says police are now searching for him. Prince was sacked from another job earlier this year after he attacked a co-worker, according to The Baltimore Sun .