Elon Musk is betting big on the reliability of transatlantic shipping companies to meet his 2,500 car-per-week goal by next month.
Tesla's Model 3 production troubles are, at this point, well documented. While the carmaker's CEO Elon Musk maintains that the ramp up is imminent, it would be easy to dismiss that as bravado for shareholder's sake. On the Tesla Q4 earnings call on Wednesday, Musk mentioned that the first production bottleneck that is currently stopping production from reaching 2,500 cars per week would be solved by the end of March. He then said that the solution was in Germany.
"That's got to be disassembled, brought over to the Gigafactory, and re-assembled and then brought into operation at the Gigafactory. It's not a question of whether it works or not. It's just a question of disassembly, transport and reassembly," Musk said in a call with analysts.
Yeah, Germany. Apparently, the battery module production line needed at Gigafactory 1 in Nevada is up and running at its Grohmann facility and that it just needs to be broken down, packed up, shipped, reassembled and started up once it gets to Reno. Sounds simple right? It's not.
This is undoubtedly a massively complicated series of pieces of equipment that will need to be painstakingly tested before it can be brought online. Can Musk, the real-life South African Tony Stark, pull it off?
The next bottleneck that Musk talked about is actually at the Fremont factory, and he believes that removing it will unlock the ability to build 5,000 cars per week. The problem, he said, lies in the current system that is in place to deliver parts from warehouses and off-site production facilities to the main assembly lines at the ex-New United Motor Manufacturing plant.
Increasing the level of automation and thus the efficiency of delivery would pay massive dividends in terms of upgraded construction capacity. Musk believes that this roadblock will be removed by the end of Q2 this year.
What's on the line if the Model 3 misses its production targets again? As it turns out, a whole helluva lot. Currently, Tesla is floating along on customer pre-orders for vehicles like the Model 3, the Roadster 2.0 and the Semi. These preorders are worth around $850 million according to reports by Automotive News.
If folks lose confidence in Musk's ability to deliver, they could start asking for their deposits back and then Tesla is, as Walter Sobchak so eloquently put it, "Entering a world of pain."