Can Model 3 Production Really Hit 10,000 Units/Week in 2018?

The Model 3 is starting production in July, which is just around the corner, and Tesla has often made comments about how many units of the Model 3 they intend to get into drivers’ hands by this year and beyond. Branded as Tesla’s first mass-market car, the Model 3 will have to actually focus on the “mass-market” part; meaning it will have to be readily available to potential consumers.

In a shareholder letter, Tesla outlined its plans for production in the next couple of years:

“Simultaneously, preparations at our production facilities are on track to support the ramp of Model 3 production to 5,000 vehicles per week at some point in 2017, and to 10,000 vehicles per week at some point in 2018.”

Is that a realistic number, though? Or is Tesla just talking big and hoping to A) draw buyers in that way, B) somehow actually hit those numbers somehow? Not too long ago, we wrote a piece on how a number of factors point to Tesla not actually being ready to start production of the Model 3. It seems now, on the eve of Model 3 production, there are more clues that Tesla will not be able to hit its goals…at least not at first.

The first clue lies in the Fremont facility itself, where prior to Tesla, NUMMI operated there. At the time it was operating, Nummi controlled more real estate, had fewer employees and produced fewer cars than Tesla is planning. In short, Tesla is planning to have twice the employees and produce 40% more cars in less space than Nummi had.

We already know Tesla has a space problem in Fremont; Elon Musk himself spoke about it at the annual shareholders meeting:

“But there is just no room at Fremont. We are bursting at the seams…So there is no way we could do Model Y at Fremont, it’s going to have to be somewhere else. And I think Fremont is just going to be focused on obviously S and X and then ramping up Model 3. I think we even have to transfer some of the things we do at Fremont to the Gigafactory just to allow for Model 3 expansion.”

Well, that’s certainly not a good sign! One of the chief complaints was the lack of parking, and construction is set to begin to add 4.6 million square feet more of space to an already cramped area that Tesla works out of. If parking is bad now, imagine what happens when adding all those new buildings starts up.

As I mentioned with the latest piece about Tesla’s timeline, maybe Tesla will pull a rabbit out if its hat and get everything built on time to start production of the Model 3. Maybe Tesla meets all of its numbers goals by the end of the year and 2018.

But looking at their current situation, it’s hard to imagine that it will happen so smoothly.

SOURCE | Seeking Alpha

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