Tesla Falls Behind on Model 3 Production in Q3

Tesla announced its third quarter output today, and it’s somewhat of a mixed bag. Although Tesla delivered more Model S and Model X vehicles than in any other quarter, it also missed its production goals for the new Model 3.

Tesla delivered a total of 26,150 vehicles, including 14,065 Model S sedans, 11,865 Model X SUVs, and 220 Model 3 sedans. Model S and X deliveries increased 4.5 percent from the same quarter a year ago, which was its previous best quarter.

Second quarter deliveries of these two vehicles are expected to exceed first quarter deliveries by several thousand vehicles, Tesla said. By the end of 2017, Tesla expects to have delivered about 100,000 Model S and X vehicles, or a 31 percent increase from 2016.

Despite the good news, Tesla failed to meet its production expectations for the Model 3. In the third quarter, Tesla only managed to make 260 copies, less than the 1,500 units projected back in August.

Tesla attributes the lower-than-expected figure to production bottlenecks. In a statement, Tesla said, “Although the vast majority of manufacturing subsystems at both our California car plant and our Nevada Gigafactory are able to operate at high rate, a handful have taken longer to activate than expected.”

Tesla also emphasized there are “no fundamental issues” with the Model 3 production or supply chain. “We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near-term,” Tesla noted.

Source: Tesla, Bloomberg

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