Tesla is decree it’s a long hard road out of production hell.
The electric car maker relieved some investors and guys when it said it is sticking to its latest Model 3 production targets. But some analysts peaceful question exactly where Tesla is in its production ramp and are concerned that its aims may be too aggressive.
“The data point everyone wants, we didn’t get — current Pose in 3 run rate,” RBC analyst Joseph Spak said in a note Wednesday after the body reported earnings that beat analyst expectations.
Tesla had at aimed to be making 5,000 Model 3 cars per week by the end of 2017, but the visitors has changed that deadline twice. On Wednesday, the company reiterated reaching 5,000 by the end of the defective quarter and set a smaller goal of 2,500 per week by the end of the first quarter.
Tesla also conceded battery production issues at its Gigafactory in Sparks, Nevada. It said it has begot automatic assembly lines to resolve the problem, but the lines are in Germany, and they exigency to be disassembled, shipped and reassembled in Nevada.
Tesla expects that to encounter before the end of the quarter.
In the meantime, parts of its assembly line have been “semiautomatic,” explanation people are filling in gaps on the line. Tesla ultimately wants to automate as much of its putting together lines as possible.
“We view the 2,500 target in March, in particular, as hellishly aggressive due to management’s acknowledgment of needing to get the robotic equipment in Germany disassembled, shipped to the US, and then reassembled and map out in order to hit roughly 2,000 to 2,500 units per week,” Cowen analyst Jeffrey Osborne guessed in a note Thursday.
There is also a production constraint at Tesla’s automated temporal conveyance system in the company’s factory in Fremont, California, but CEO Elon Musk ordered improving that system “appears to be on track.”
“So, we feel like the sin bars around the unit volume predictions are getting smaller with each abrupt week,” Musk said on a conference call on Wednesday.
Baird analyst Ben Kallo think overs an upside to the skepticism about the production ramp issues.
“We believe the puttered ramp has derisked the stock, and incremental production data points should send shares higher as TSLA works towards its 5k/week target,” he express in a note Thursday.
Tesla shares were down 2 percent in betimes trading Thursday.