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Tesla Shocks Markets: Achieves Model 3 Production Target

Tesla assembly line

Tesla has hit its target of producing 5,000 Model 3 sedans weekly, just as CEO Elon Musk promised investors at the release of the company’s Q1 financial results, Electrek reports, quoting an email Musk sent to all personnel praising them for the “incredible job.”

The production ramp-up for the Model 3, on which Tesla has pinned its hopes of becoming a mainstream carmaker, has proved challenging, with the company failing to reach its original deadline at the end of 2017. The last one was June 30, and according to Musk, it has been kept.

In addition to the 5,000 Model 3s weekly, Tesla also produced some 2,000 Model S and Model X vehicles, bringing the total to 7,000 cars weekly. As Electrek’s Fred Lambert notes, this is the usual weekly production rate for Model S and Model X, but adding that the 5,000 Model 3s to that has been the challenge.

Not everyone is impressed, however. The Associated Press quotes market research firm AutoPacific’s manager of product analysis Dave Sullivan as saying “Reaching it is one thing. Consistently producing 5,000 per week with outstanding quality is another. I don’t think producing 5,000 once is anything to get excited about until it’s repeatable.”

The Model 3 endeavor is widely seen as the project that will make or break Tesla. The company has never posted a profit before and has been burning cash at worrying rates, with US$1 billion spent during the first quarter of this year alone. As investors started to get restless, Musk kept on making grand promises for future Tesla models and new Model 3 versions, which must have added to the annoyance.

Tesla’s Model 3 announcement was an eagerly awaited update, although AutoPacific’s Sullivan does have a point that repeatability is essential in order for the Model 3 to become the success Tesla needs it to be.

By Irina Slav for Oilprice.com

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  • cowboybob on July 02 2018 said:
    ElonCon continues....
  • H on July 02 2018 said:
    John, Tesla lost $887 million in FY 2016. I think the story is pretty accurate.
  • John on July 02 2018 said:
    google "has tesla ever made a profit"
    "Tesla just unveiled one of its most unusual feats yet: turning a profit. Tesla (TSLA) posted a profit of $22 million for the third quarter, which is just the second time it has ever been in the black. Its only other quarterly profit came more than three years ago.Oct 26, 2016"
    - cnn

    So, maybe a little fact checking before absolute statements.

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