Tesla hits 5,000-unit weekly production for Model 3

Tesla’s Model 3

Tesla’s Model 3

Tesla stock initially jumped, then retreated Monday after the maker of electric vehicles said it hit the target for Model 3 production that Chief Executive Elon Musk said was critical for the company to reach profitability. But that's not all.

"Model 3 production had already significantly increased over those 6 months, but Tesla had heavily invested into a production capacity of over 5,000 units per week and it needed to get there in order to turn a profit on the vehicle program". Tesla said the conventional assembly line, known as GA3, can reach a production rate of 5,000 Model 3s a week alone, but that the new GA4 line helped achieve that goal faster, and will help exceed that rate.

The job cuts are part of a company-wide restructuring to address excess staff in some areas due to the company's speedy growth, Musk said in an email to employees.

The social media post was first viewed as shockingly good news for a company that has continually missed production targets and lost money for 15 years in a row.

To meet its goal, Tesla had set up a new production line inside a tent on the campus of its Fremont factory.

Tesla produced 28,578 Model 3s in the second quarter - an average of about 2,200 per week.

The evidence points to Tesla boosting Model 3 deliveries to Canada for two reasons. "Model 3 Dual Motor All Wheel Drive and Model 3 Dual Motor All Wheel Drive Performance cars will also be available in our stores shortly".

"Yes, excessive automation at Tesla was a mistake", Musk said via Twitter this past April.

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After working around the clock for weeks on end to surpass a production goal, Tesla Inc.is pausing some Model 3 production this week, according to people familiar with the matter. The automaker also produced 1,913 Model S and Model X vehicles in those same seven days.

No matter how freaky, Tesla CEO Elon Musk's warnings to investors who bet against his company have been prescient.

Tesla reported 18,440 total Model 3 deliveries in the second quarter, with InsideEVs estimating 3,875 USA deliveries in April, 6,250 in May, and 6,050 in June. Last July, when rolling out the first production cars for customers, Musk said the Model 3 would have an extended range version - 310 miles - for $44,000. Its Model S and X deliveries met expectations, it said.

While the Model 3 production rate is a success, sceptics warn the recent burst may not be sustainable.

Of course, pumping out Model 3 wasn't the only concern some had. In an effort to show sustainability/ improvement, company indicated 6k Model 3s/week expected late next month.

"Tesla reaffirmed its guide for positive GAAP net income and cash flow in Q3 and Q4, which is in line with our estimates, but we believe much more optimistic than many investors continue to assume".

Many have been waiting since March of 2016, when Tesla began taking orders with a $1,000 refundable deposit.

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