Musk Sees 'Production Hell' Ahead as Model 3 Output Ramps Up

Posted July 30, 2017

The first 30 Model 3 sedans-mass-market versions of Tesla's pricey electric cars-were to roll out of a California plant for delivery, mainly to Tesla employees.

Tesla has revealed that its premium Model 3 will cost $44,000 before tax rebates, a $9,000 increase over its $35,000 base price. And regarding demand, Musk said that while the number of reservations is a false indicator when it comes to measuring true demand (since Tesla does "everything we can to unsell the car"), it's now sitting at over half a million advance reservations in place.

The Long Range Model 3 is priced at $44,000 which will provide some significant improvements over the entry level vehicle.

Production delays and quality issues marred the launches of Tesla's Model S and Model X vehicles, and the company blamed production problems for a shortfall during the second quarter of this year.

Hundreds of Tesla workers and fans whooped as Musk announced the arrival of what he called the world's first "great, affordable electric vehicle that's better than a gasoline auto".

Tesla will then place your order in line and deliver the vehicle as it becomes available in your region. The standard battery on the base model, which Tesla said will come this fall, will have a range of 220 miles.

There are electric vehicle makers and then there is Tesla Motors.

Like Tesla's other models, the Model 3 boasts some impressive headline figures. Unlike the Model S and Model X, the tablet in the Model 3 is horizontal.

He stressed that there are thousands of parts from suppliers around the world that come together to make each auto, and that production could stumble if any component is delayed.

This is pretty much what Musk has been trying to say all along. "For at least 6 months, maybe longer", Musk said.

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At some point in the future, Tesla promises to enable full self-driving capability to the Model 3.

Tesla faces major hurdles living up to the Model 3 hype.

Recharging the battery via Tesla's high-speed superchargers will add 130 miles of range in 30 minutes.

And with the arrival of the Model 3, which secured an estimated 500,000 pre-orders, the pressure is now mounting on the traditional automakers to quicken the pace in bringing their electric cars to market.

The company has pledged to produce 500,000 of the vehicles next year, which would be nearly six times the number it produced last year.

Were Tesla to produce and sell 500,000 cars per year, the company would likely outsell the BMW, Mercedes, or Lexus brands in the United States.

But Musk says Tesla worked hard to make the Model 3 simpler and cheaper to make than Tesla's previous vehicles.

"This is one of Tesla's challenges - they've always launched in a white space before", said Michelle Krebs, executive analyst with Autotrader.

The company enters crucial phase as it seeks to meet its ambitious production schedule for the Model 3.