The promise was to produce 2500 Model 3 per week by the end of March , but not even that goal was achieved. Since the last week of the month turned out to be particularly bad for the Californian builder.
Even the last efforts in recent days, including Saturday, the last day of the month, to increase the production of the Model 3, were not enough. As Autonews reports, sofas were installed, a DJ was hired and even a food van was on the premises to support the workers. Tesla even invited workers from the Model S and Model X production lines to volunteer and assist in the production of the Model 3.
There has definitely been an increase in production in recent weeks and, in an email sent by Elon Musk to his "troops" at the beginning of the last week of March, he mentioned that everything was on track to reach them. the 2000 Model 3 mark per week — a remarkable evolution, no doubt, but still far from the initial objectives.
The question arises: how will the rush to increase production, which will allow investors to show more sumptuous numbers, affect the quality of the final product?
Concerns beyond production
As if the “production hell” and the growing pains of becoming a high-volume builder in a short period of time weren't enough, the end of the month and quarter — Tesla reveals all its numbers every three months — it was a “perfect storm” for Elon Musk and Tesla.
The brand is again under scrutiny by regulators after yet another fatal accident involving a Tesla Model X and the Autopilot — its driving assistance system — and has also announced a recall operation for 123,000 Model S, produced before April, 2016, to replace a component related to assisted driving.
To (not) help, ratings agency Moody's lowered the brand's level to B3 — six levels below “junk” — citing a combination of production line issues and obligations that keep piling up, with the brand in power need one capital increase in the order of two billion dollars (approximately 1625 million euros), to avoid running out of money.
Expectably, Tesla's shares took a significant tumble. Of the more than $300 a share at the beginning of the last week of March, yesterday, April 2, it was just $252.
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Investors with “faith” shaken?
Investors themselves are starting to get restless. “Tesla is testing our patience,” says Gene Munster, managing partner at Loup Ventures, a venture capital firm, who has always supported Tesla. Although, with the latest developments, doubts are starting to settle in: “(…) do we still believe in this story?”
The April 1st joke by Elon Musk didn't help.
Elon was found passed out against a Tesla Model 3, surrounded by “Teslaquilla” bottles, the tracks of dried tears still visible on his cheeks.
This is not a forward-looking statement, because, obviously, what’s the point?
Happy New Month! pic.twitter.com/YcouvFz6Y1
— Elon Musk (@elonmusk) 1 April 2018
But Loup Ventures' answer to its own question is “yes”. Gene Munster, again: "The company (Tesla) is uniquely positioned to capitalize on the dramatic changes (in the automobile industry)." Adding that he thinks Tesla "will innovate both in Electric Vehicle (technology) and in autonomous driving, and will introduce a new paradigm in production efficiency."