Manufacturing process being run by suppliers had to be taken back in-house ©Tesla
Manufacturing process being run by suppliers had to be taken back in-house ©Tesla

Suppliers blamed for Tesla Model 3 delays

6 November 2017

Supplier issues have contributed to production delays for Tesla’s new Model 3 electric vehicle, the firm has said.

The California-based car manufacturer had hoped to be producing 5,000 units a week of its latest, more affordable, electric car by the end of the year. But problems at its highly automated ‘Gigafactory’ battery plant in Nevada have forced the firm to pushed this target back to March.

Tesla considers the Model 3, which starts at $35,000, its first mass market car and it is a key part of CEO Elon Musk’s aspirations to make electric vehicles ubiquitous and Tesla a major automotive manufacturer.

However, the complexity of the battery design and the automated manufacturing process has meant that mass production has taken “longer to ramp up than expected”.

In a letter to shareholders, the firm said key elements of the battery manufacturing process that were being run by suppliers had to be taken over and redesigned by the in-house team.

“The biggest challenge is that the first two zones of a four zone process, key elements of which were done by manufacturing systems suppliers, had to be taken over and significantly redesigned by Tesla,” the firm said.

“We have redirected our best engineering talent to fine tune the automated process and related robotics programming, and we are confident that throughput will increase substantially in upcoming weeks.”

Tesla said these were early bottlenecks and there were no fundamental problems with its supply chain or production processes.

Tesla’s US website cites a 12-18 month delivery period for new Model 3 orders.

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