Tesla Factory Tours Reveal “Stunning Progress”

1 year ago by Eric Loveday 87

Inside Tesla's Fremont Factory

Inside Tesla’s Fremont Factory

Inside Tesla's Fremont Factory

Inside Tesla’s Fremont Factory

Recently, Tesla allowed some Wall Street analyst types to tour its Fremont factory and apparently those tours have resulted in most analsyts concluding that Tesla has made tremendous progress at Fremont as it gears up for the Model 3.

As Bloomberg reports:

“Tesla spent some $1.6 billion on major upgrades last year as it prepares to launch its first attempt at a mass-market car—the Model 3—on March 31. The transformation is striking, according to auto analysts at Stifel Financial Corp., Credit Suisse Group AG, and Baird.”

Perhaps more important than the spending is that analysts say “Tesla is learning from the mistakes that delayed its previous launches” and will reportedly stay on track with the Model 3 launch slated for late 2017.

Additional changes at Fremont, as described by Tesla’s new chief financial officer, Jason Wheeler, include:

  • New Aluminum Stamping Press with up to 20 times the output of Tesla’s previous machine
  • Paint Shop capable of painting up to 500,000 cars a year
  • Faster Assembly Lines with capabilities of up to 175,000 cars per year
  • More Robots
  • More employees

Lastly, the analysts saw Model X production moving along at a decent rate, but noted that Tesla is making 5 to 6 Model S electric cars for every 1 Model X rolling off the line.

Source: Bloomberg

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87 responses to "Tesla Factory Tours Reveal “Stunning Progress”"

  1. SparkEV says:

    Late 2017 for model 3? Ughhh!!! Hurry the hell up!

    1. Ziv says:

      Late 2017, maybe, but only if Tesla is able to jump through multiple production hoops successfully. And then only if you have a Tesla S already AND live in California AND you want a fully loaded III.
      I think most non-Tesla owning Californians will be looking at maybe getting a loaded III in the spring of 2018 and the rest of us non-Californians are probably going to be able to get one late in 2018.

      1. ItsNotAboutTheMoney says:

        It’s called Model 3.

            1. Pushmi-Pullyu says:

              Yeah. Semi-seriously, Tesla very specifically said it is not three vertical lines. It’s ≡, not III. 🙂

        1. Blastphemy says:

          It’s actually called Model ☰, nerd.

          1. sven says:

            Why the name calling? 🙁

          2. Max S. says:

            Nerd? Yet you fire up an ASCII chart to type the proper “3”? Hippo much.

            1. scott franco says:

              Hecks no. I cut and pasted the others text. Too much work to figure out the other methods.

              ☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰☰

      2. SparkEV says:

        I don’t want the very first year model. I’m going to wait a year (or two) for them to shake out the bugs. That’s why they need to hurry it up. If they announced 2017, delays would push it to 2018 or later for base model, and most likely 2020 for me.

        1. James says:

          OK, so you will be reserving your in store after lunch. 🙂

          1. Tesla8 says:

            LOL
            2018 @ 10:01
            2019 @ 10:30
            2020 @ 12:00
            2021 @ 20:31

            1. Reddy says:

              +1000 Spot on!

    2. GeorgeS says:

      One thing not mentioned is how Tesla will make the transition from all aluminum to mostly steel or better yet multiple materials welded or glued together. This is tech that the big auto makers have but AFAIK Tesla does not.

      So just because Tesla has a new aluminum stamping machine does not necessarily mean it will be a quick transition to the Model 3 that is rumored to be mostly steel.

      1. James says:

        The answer, the rumor of steel is simply wrong. 1st why would Tesla get into steel when all their expertise and equipment is geared to aluminum? 2nd why would they up grade to an aluminum press 20 times more capable (i.e. 20 x 50k made last year = one million). 3rd Tesla is all about sustainability so why would they depart from using the most efficient and fully 100% recyclable metal. And 4th Tesla wants reduce the car’s size/weight not increase it. Their may at most be only a hint of high strength steel in the chassis for safety vs performance trade offs, but not as a strategic material in the Model 3 for cost reducing reasons as rumored.

        1. Ziv says:

          The answer to your multiple “why”‘s is, cost. $35,000 is an incredible price for a car with around 60 kWh of pack.
          Can they do 200+ miles of AER and aluminum at a sales price of $35,000? I don’t think even Tesla can do that.

        2. HVACman says:

          1 – Why steel? $ and profit at $35K retail sale price.

          2- Don’t know. Maybe the analyst is wrong, or Tesla got a “deal” for the new press and never plan to actually use it to full capacity, or ???

          3 – Steel is actually more sustainable than aluminum. The embodied energy in aluminum is an order of magnitude higher than the structurally-equivalent amount of steel. And steel is also 100% recyclable – you just don’t see it highlighted much in the residential blue bins. Go to any commercial/industrial recycle center and take a look at the bulk of the material. Or just watch “Breaking Bad”:)

          4 – see 1. Aluminum for optimal performance, HS steel for optimal cost-effectiveness. Carbon fiber continues to evolve at a fast clip, similar to the batteries, and could overtake both Al and steel in a few years, for a lot of reasons. It is now almost ubiquitous in mid-level and higher bicycles.

        3. Pushmi-Pullyu says:

          James said:

          “The answer, the rumor of steel is simply wrong.”

          It’s not even remotely a “rumor”. Tesla has stated very directly and, I think, repeatedly that the Model ≡ body will be mostly steel, to save costs.

          “1st why would Tesla get into steel when all their expertise and equipment is geared to aluminum?”

          Because steel is cheaper and easier to work with. That saves not only money, but assembly time. And it’s not like working in steel is some sort of esoteric art known only to a few. It’s a lot easier to find metal workers and welders with experience working with steel than experience working with aluminum.

          “2nd why would they up grade to an aluminum press 20 times more capable…”

          So they can make Model S and X car bodies faster. They’re ramping up production of the Model X this year. Obviously that’s not needed for the Model ≡.

          “And 4th Tesla wants reduce the car’s size/weight not increase it.”

          Obviously Tesla has decided cost savings is more important than weight savings. And they’re right, of course. A lot has to be sacrificed to make a car that will sell for half the price as their existing models.

          Those who think the Model ≡ will be merely a slightly shrunken version of the Model S… are in for a big shock next week.

        4. scott franco says:

          “why would they depart from using the most efficient and fully 100% recyclable metal”

          Err bad news. That would be steel. %100 recyclable, far more efficient power wise to manufacture, etc.

        5. sven says:

          Actually, it’s “up to 20 times the output.” So that’s the max, with no mention of what the average is expected to be.

      2. EV Driver says:

        Tesla is not transitioning to steel. What a stupid rumor

        1. Pushmi-Pullyu says:

          Thrice wrong.

        2. mhpr262 says:

          They are, they have said so themselves, very clearly.

          1. EV Driver says:

            They have said that they “can’t use aluminum for all the components”. That is worlds different than saying they are transitioning to mostly steel.

            Am I missing some other statement they made on this?

      3. scott franco says:

        “So just because Tesla has a new aluminum stamping machine does not necessarily mean it will be a quick transition to the Model 3 that is rumored to be mostly steel.”

        Is it just me, or did that make no sense whatever?

  2. Mister G says:

    GO TESLA GO…tell all the naysayers and oil addicts to kiss your ARSE

    1. ffbj says:

      On an interesting side note regarding oil.
      Rockefeller Foundation divests from oil:
      http://finance.yahoo.com/news/rockefeller-fund-dumping-fossil-fuels-hits-exxon-climate-161946355–sector.html

      1. TomArt says:

        Priceless and absolutely true:

        “Though only a sliver of the endowment’s modest $130 million in assets is invested in fossil fuels, the move is notable because a century ago John D. Rockefeller Sr. made a fortune running Standard Oil, a precursor to Exxon Mobil. The charity said it will also divest from coal and Canadian oil sands.

        Given the threat posed to the survival of human and natural ecosystems, “there is no sane rationale for companies to continue to explore for new sources of hydrocarbons,” the Rockefeller Family Fund said.”

    2. Pete says:

      Lol, Tesla is also oil addict. Especially Tesla drivers eat tires which are made out of oil. With out oil NO plastic interieur, without oil no truck or ship transport.
      So rather go walking.

      1. Nick says:

        You don’t need oil for any of those things.

        It’s just the cheapest in a distorted market full of externalities.

      2. EV Driver says:

        Yes, that makes sense. You can drive a zero emissions vehicle powered by renewable energy and help eliminate what scientists believe is the number one threat to our planet or you can niggle about the fact the car may contain synthetic materials that may be derived from oil, which no scientists believe is a significant threat to out planet.

      3. Spec says:

        Making products out of oil is not a problem. Burning it is the problem.

      4. martinwinlow says:

        Oh, dear.

      5. Mister G says:

        Pete, your addiction to oil is obvious, say these words”I’m an oil addict” 3 times to begin your recovery LOL

      6. Scott says:

        Dude…please.

  3. David Murray says:

    Good news.. You know this has the other auto-makers scared. There’s no doubt that GM’s new Bolt and even the awesome improvements on the Volt are a direct result of the threat of Model-III. So far, Tesla has only taken business away from luxury automakers. When the Model-III comes out, every auto-maker is going to feel it. What Tesla needs to do next is announce an electric pickup. That’ll get Ford and Chevy scrambling to produce one of their own.

    1. ffbj says:

      Indubitably!

    2. pvwowk says:

      Except the Model ||| is designed specifically for the full-size market. Also, there has been plenty of warning that it is coming (Tesla has been talking about it for the last 5 years, or longer…). When it comes out, late 2017, there will be a lot of 200+ mile range competition. Likely contenders are the Bolt, Leaf, Golf, and Focus (all of which are due to have the redesign released for 2017/2018 model year, and all companies have a strong motivation to go electric). Also, there are unknown models that could be surprised on us before the model |||.

      My point, I think Tesla is going to do well, but other companies have prepared and have strong competition.

      1. ItsNotAboutTheMoney says:

        It’s called Model 3

        1. ffbj says:

          Call it what you will, but that is not its designation.

      2. TomArt says:

        I’m fairly certain that it is in the mid-sized sedan segment (in USA terms), like Audi A4, BMW 3-series, etc.

      3. Paul says:

        It has always been the intention of Tesla to push the event of electric mobility. Not only by their own production, but even more by inspiring/forcing others into the market by fear of losing out.

        Yes, it is competition, but they created it and hoped for it. And all this is good for us and the planet.

    3. David, per the point “What Tesla needs to do next is announce an electric pickup. That’ll get Ford and Chevy scrambling to produce one of their own.”, the question I have for Teslas desired ‘F150 Killer’, is – will they make it able to tow 10,000 lbs in base model, and tow 14,000 lbs in Performance model, and drive at least 250 miles while towing said loads at freeway speeds – today, or within 4-5 years?

      If nor, maybe they should start with some numbers on the Ranger and Colorado dized Pickups, like:
      What is their max towing loads?
      What is their max range while towing said loads?
      How many of the sales of said trucks get used in this manner daily, or frequently?
      In what regions do these trucks get used heaviest for work versus just for appearance?

      Having those numbers for these smaller trucks(and F150 + RAM +Silverado), and their battery knowledge, will give them the best case info to determine when it is the right time to bring out a Tesla Pickup, and if it should taget Smaller trucks or larger ones!

      Also, pickups, like the Model X, usually have Towing capability, and do tow, so Supercharging stations need to be designed and installed with drive through charging potential. So I think they need to extend the plans of them first, to start satisfying the needs for this for the Model X towing a boat or other small trailer, in advance of a pickup entry.

      Tesla could also use what they have at their disposal with the Model S and Model X, to design a Powered Trailer, using a redesigned Chassis, as the base for said trailer!

      Can you imagine a trailer that communicates with the Model X or Tesla Pickup, has something like a 70 or 90 kWh pack and single or dual motor drive of its own, and effectively reduces the effective ‘Towing Weight’ on the towing vehicle, such that even the current Model X could tow a real load of over 10,000 lbs, and an even stronger built pickup could tow over 15,000 lbs, if using the ‘Tesla Trailer’? (Or, tow a standard load of 10,000 lbs with a generic trailer!)

      Said Tesla Trailer, if it was a big box, could have an option of a Solar Roof, turning it into a Portable Solar Power Station, and with the right wiring and control electronics, could offer Work Site Power, EV Charging, and maybe a Portable Light Source, too! Possibly even home backup and liad shifting source, even more usefull than a Tesla Powerwall, so it could be a collaborative product from Tesla Motors AND Tesla Energy!

      1. Pushmi-Pullyu says:

        “…the question I have for Teslas desired ‘F150 Killer’, is – will they make it able to tow 10,000 lbs in base model, and tow 14,000 lbs in Performance model, and drive at least 250 miles while towing said loads at freeway speeds – today, or within 4-5 years?”

        I seriously doubt that Tesla will be able to put a battery pack containing enough energy to do that into a pickup within only 4-5 years. If they do, it probably will be only by switching to a completely different sort of “battery” such as an aluminum-air fuel cell.

        And that’s why Tesla has only mentioned making a pickup in terms of “Wouldn’t it be nice if someday we can do that”, rather than something they are currently working on developing.

        My guess is that the first generation of BEV pickups, regardless of what auto maker produces them, will be compact pickups with limited towing ability. Expect electric range to drop quite significantly when towing a trailer at highway speed, just like the Model X.

      2. Speculawyer says:

        Those kind of specs are just not possible with today’s technology without the pick-up costing more than the highest spec Model X. Pick-ups have TERRIBLE aerodynamics so if you want long range, you’ll need a massive battery.

        For now, I think plug-in hybrids are the only way to pick-ups and big SUVs.

        The Model X isn’t even an SUV, it is a cross over. The back row of seats is pretty tight. And it is not very tall. This is what has to be done to just to make a 7 person crossover that isn’t even affordable for most. The Model X is so aerodynamic that it has better drag coefficient than the original tiny Roadster!

        (BTW, just got back from the factory tour . . . cool stuff.)

      3. Nix says:

        Towing 14,000 or 15,000 lbs isn’t even possible with an F-150. Typical F-150 has a towing capacity of half that, more around 7 or 8 thousand pounds, with only a few specially equipped models getting up to 10-11 thousand pounds.

        https://www.ford.com/trucks/f150/specifications/towing/

        For 15,000 lb towing capacity, you are talking about a Ford Super Duty F-350 Diesel Dually rear axle competitor.

        Sorry, that’s not realistic with even a 10X battery improvement. It is hard to appreciate exactly how much power is involved with a sustained uphill pull of 10-15,000 lbs.

        An EV pickup should target around 8-9,000 lb towing capacity max for any sustained highway travel, with 5,000 lbs being more realistic.

        1. Ed Post says:

          Well, in fact, it’s EASY to appreciate how much power it takes to do a sustained uphill pull. My Tesla weighs 4700 pounds. On the flat it uses about 20kW to cruise down the Interstate at 55mph. Driving up the hill on I-70 from Silverthorne to the Eisenhower tunnel (a 6% grade), it takes about 60kW. Out of an available 320. (Mine’s a 2 wheel drive model. The 4WD models can do 480kW.) So, the math suggests that even the least powerful motor in the current Tesla fleet can pull 10-15,000 pounds up a significant hill without slowing down. Now, can the battery pack support that drain indefinitely? Probably. A driver video of a P85D on the Nurburgring shows the power limited due to battery heat to 240kW at about 1:40 into the run. That’s almost exactly the power necessary to maintain speed up a 6% grade pulling 15,000lb, and it maintained that for the rest of the 8:50 run. https://www.youtube.com/watch?v=Dphw4km60m4

    4. Three Electrics says:

      The Bolt has a multi-year head start on the Model 3. I find it hard to believe that it was made in response to anything that Tesla is doing. I suspect it has more to do with the state of battery technology and regulatory environments in California and Europe.

      1. Speculawyer says:

        Well, the Tesla plan of working its way down the food chain of cars starting from the top has been known for some 10 years now. GM knew that Tesla was planning on building the Model 3 . . . and it looks like GM will beat Tesla to the market by a good margin.

        However, GM still doesn’t quite ‘get it’. The Bolt is a little clunky looking. And worse, they don’t seem have any plans to work on a good DC fast-charging network for the Bolt. Relying only upon the few haphazardly deployed 50KW CCS chargers is quite weak compared to the full network of strategically placed 125KW Superchargers.

  4. PVH says:

    Yes, but still a big quality control problem in that very factory. Here a sample of recent remarks from Norwegian Tesla Model S owners on elbilforum.no. (156 pages of owners reporting problems, there is a special thread on them).

    http://elbilforum.no/forum/index.php/topic,10160.2295.html

    It is translated from Norwegian using G. Chrome:

    Then there are some who have gold hair a certain place, and others who may be unfortunate. Although I have had 8 different cars within approximately last 30years. NONE of them have been anything other than a few niggles with – except the last one (Tesla).None of the others has cost me over 200 000 (NOK) – in purchasing, – except the last one. The last has cost more than 3 times as much as any of the others I bought, and have had so much problems and errors that have been directly embarrassing to drive around in it. it has been more on workshop during the two years I’ve had it, than all the other cars I have had together the remaining 30years. With such a high price I paid for the last car, I actually have much higher expectations for it to be in order, and better run than all the expensive cars I have had before this.
    My 2015 85D from July, is now just as flawed as my first 85 (2014). It was good the first 10.000km, but after that there have been raging on in error. Here are the things that should be checked in service in a few weeks: – Charging port will not open – The window behind the driver’s side switches inside the list when it opens, it seems like it takes too long to lose. – Cracking during cornering – Poor DAB – Dew in backlight, fremlys and reflexes – Blind Spot warning disabled when it rains and speeds over 100-110ish – must login TuneIn / spotify – Armrest resolved, has now tumbled by – loose cover by takstativfester, stands up while driving – Rubber Lists by takstativfestet is also twisted or loose. – Poor klimaatuomatikk must use manual to avoid dew in the car – Cruise Control does not work when it is raining and dark, not even when it’s cold – creaking in pano by cold. Sounds like it’s going in front. – Lists around the windows are not aligned. Seems like doors hung. – Injuries to the driver’s seat. Looks like skin creasing. – Asking for clunk in YOU. – High squealing noise of the engine in front. Especially around 50km / h has asked to return the car. Had the first Tesla my more workshop than in the garage so this time I bothered not keep on like that.

    So, if Tesla does not quickly address this reliability problem it will more and more become an American only story as it will take massive chauvimism to accept paying so much for that level of reliability. Sales are slowing down in Norway by the way and it is probably not only because of NOK/USD unfavorable exchange rate. This information is open to all.

    1. ffbj says:

      This is now the line of attack of legacy car companies. For instance they will hit at Tesla by saying things like our vehicles have access to service and dealers across the country. Of course they fail to admit that they trying to prevent Tesla from opening same.

      Sure the car is 3x times the cost and 4x better than any car someone has ever owned.
      It is true though that they need to work on these minor problems, and there will always be people who are never completely satisfied. Anyway this is part anti Tesla campaign, that has failed to take hold, since people are able to think for themselves and make determinations based on their own experience and those of 10’s of thousands of satisfied owners.

      It’s a complex machine and there are going to be things that go wrong. But having the cruise control not work at times is not like having the vehicle cause your death, and then ignoring the issue, as many more people died and were maimed.

      1. PVH says:

        It is true that it is a complex machine and probably Aston Martin is not doing better on reliability while making cars not nearly as good as Model S but nevertheless Tesla needs to really improve on that (reliability) however I see little incentive for them to do so considering the massive blind and forgiving love they receive. We have a say that goes like this “who loves well chastises well” (in case of love from parent to child). And I see many here who do love Tesla, but do not love “well”, maintaining Tesla in an artificial protective bubble. It doesn’t work that way when playing amongst the big boys (Model 3).

        1. James says:

          Come on PVH, is that the only dirt you could find on Tesla’s reliability? You had to hunt it down in a little northern Scandinavian country? Sure, Consumer Reports no longer recommends the Model S only because of this issue, but Tesla is a HUGELY consumer responsive company.

          Just consider how they are prioritizing deliveries of the Model ≡: employees 1st, Model S/X owners 2nd, west cost and highly optioned buyers 3rd (ie EV lovers). Their rollout strategy is to resolve all production issues with highly involved and forgiving customers first, before it rolls out to the general public. I have a lot of faith that by the time I get mine, the Model ≡ will be a great car.

          1. Mxs says:

            He was talking about actual failures not whether they are responsive to consumers ….

            With their minuscule sample of sold vehicles, more so mainly to people who have a lot of disposable money and usually another vehicle to use, it’s impossible really to say how bad it is. The model 3 guinea pigs will be the furst real world proof in the pudding.

            It will be interesting whether the fan boys can objective then. I doubt it …. Brand blindness is spread nowadays like a flu.

        2. ffbj says:

          I agree that it is something they need to work on. I also agree that people will overlook things, like faults, like when people are in love. So there is something to what you are getting at.

      2. theflew says:

        GM hasn’t stopped Tesla from opening service centers. GM can’t lobby against a service center any more than they can stop a Pep Boys from opening. They have only tried to stop sales centers which under current rules shouldn’t be allowed.

        1. GSP says:

          In Michigan it is against the law for a manufacturer to service cars. Tesla has to ship cars to their Cleveland service center for heavy repairs that can’t be done at the customer’s home by a ranger.

          GSP

          1. TomArt says:

            Seriously?!?

    2. Pushmi-Pullyu says:

      PVH said:

      “So, if Tesla does not quickly address this reliability problem it will more and more become an American only story as it will take massive chauvimism to accept paying so much for that level of reliability.”

      I agree that Tesla does need to work on its reliability. But as has been pointed out by others, all high-end cars with lots of high-tech geegaws have numerous reliability problems. The annual service and repair costs for Tesla cars are significantly less than other “premium” cars in the same price range.

      If you want a car without any issues that need to be addressed at a service shop, then don’t buy a high-end car. Buy something made more simply. Toyota and Volvo have very good reliability ratings, as I recall.

      And it should be self-evident that as the volume of Tesla sales ramps up, the sheer number of people reporting problems will also go up, regardless of how reliable the cars are on average. I’m sure you can even find complaints about Volvos if you want to look online.

  5. Loboc says:

    IF Tesla sticks a couple superchargers along my normal routes, I might consider a Model 3. Until then, I’ll stick with ELR.

    Dallas => Springfield MO and back (any route)
    Dallas => Branson MO and back (via AR)
    Ft. Worth => OK City => Joplin MO and back
    Dallas => Galveston and back (almost there)

    1. Nix says:

      Maybe if Texas would allow direct sales of Tesla cars, people like me might care.

      Until then, too bad Texas, you reap what you sow.

      It is hard to make a state who doesn’t want Tesla to sell there a high priority in the build-out of the Tesla Supercharger network. The money is better spent in states that actually want Tesla selling car in their states.

      1. Pushmi-Pullyu says:

        Treating would-be customers like unwanted step-children just because the State they reside in is governed by people with a political agenda opposing electric cars, would not be a very smart way to run a business.

        It’s a good thing Tesla doesn’t have your attitude.

    2. GSP says:

      Loboc,

      When the Catoosa supercharger is ready that enables all of your routes except for Branson, MO. Maybe you could spend the night and charge in Arkansas when you go there?

      Ft. Worth to Galveston is “fully supercharged” now, so it would not be a problem.

      GSP

  6. michfin says:

    I bought a Model S last year and had two problems. One right out of the gate was the passenger mirror would not reset after backing up. They came to my home and replaced the motor. Then the battery in my remote key fob died after about 6 months and they came to my home and replaced the battery. After I told them I could change the battery myself, they insisted in coming so they could make sure it wasn’t something else.

    I also bought a Chevy Volt 2 years ago and shortly after buying the car the regen brakes on of the wheels broke and needed replacing. Also the check engine light came on and they had to replace some sensor.

    So I figure they’re pretty much the same based on my experience.

    1. Mxs says:

      Really, based on your two vehicles????

      Why cannot people focus on simple facts and numbers, it’s not that difficult, if you can leave your Tesla or GM feelings out of it.

    2. DonC says:

      If better than average is the same as worse than average then yes, they are the same. Otherwise not so much.

      1. GSP says:

        Ian going to make a wild guess that about half of all cars built are above average, and about half are below average.

        I will predict that no matter how hard the automakers work on it, this will *always* be true! 🙂

        GSP

  7. ffbj says:

    It’s a temperature sensor failure. A common problem.

  8. DonC says:

    A Wall Street analyst commenting on a production process? So funny.

    Surprising issues remain given all the progress that has been made: https://teslamotorsclub.com/tmc/threads/horrible-horrible-and-terrible-day.66202/

    1. sven says:

      Yikes! His driver-side door won’t open, his passenger-side door won’t close, his driver’s side falcon-wing door is misaligned when closed, Tesla “forgot” to paint part of the door on both the driver’s side door and the passenger’s side door, he has scratches on the paint job, and his wheel alignment is off.

      All these problems, and he’s only had the car for a couple of hours! Double facepalm, because a single facepalm just won’t do.

      Worse yet, one day after his Model X was delivered, his wife delivered a healthy baby. It’s a good thing he didn’t have to rely on his Model X to get her to the hospital, because sometimes your car’s lack of reliability may turn out to be more than just a small inconvenience.

      1. Pushmi-Pullyu says:

        One Tesla basher encouraging another. How wonderful for a website about EVs. 🙁 As welcome as two skunks at a lawn party.

        So, sven, the message you’re trying to send is that all TSLA stockholders should panic and sell their stock at fire sale prices, and nobody should buy a Tesla car because their wife might have a baby the day after they buy it.

        Got it.

        What was that you were saying about “double facepalm”? Yes, I think that’s the proper response here.

        1. sven says:

          Actually, if my wife was having a baby anytime during owning a Model X, I’d want it to be reliable. It would kind of suck if your loved one was having a medical emergency when you were out in the middle of nowhere, and none of your doors would open or your car is inoperable in some other way. If I have to drive a loved on to the hospital in an emergency, you bet I’d want that car to be reliable.

          I’m not trying to send any message to TSLA stockholders. I don’t care if they make or lose money on their investments. What I care about is getting an accurate picture of the build quality, reliability, and repair costs of the cars Tesla builds. Unlike you, I’m a prospective purchaser. In January, the excuse for all the fit, finish, and other problems that the Model X cars were having was that Tesla rushed to get cars out the door by 12/31/15 to count as a 2015 sale, and let quality control slide. The Model X in the post above was delivered in March, and Tesla forgot to paint parts of both front doors, both of which don’t work by the way. Really? Forgetting to paint a part of the car is a pretty blatant fit and finish problem. This ain’t a 1980s $4,000 Yugo; this is a 2016 $100k+ Tesla. Where was the quality control to inspect the car before delivery? What’s the excuse now?

    2. Speculawyer says:

      From my factory tour of today:

      The Model X line is definitely a work in process. They have problems assembling the Model X with every batch they do. However, with every problem they have, they go back and change the things that caused the problem making the a line a little better.

      1. TomArt says:

        Holy hell, that’s messed up! Unless all non-Japanese automakers have the same problems and they just don’t say anything…

  9. Nix says:

    “Tesla spent some $1.6 billion on major upgrades last year as it prepares to launch its first attempt at a mass-market car—the Model 3”

    Hmm… But the folks shorting TSLA stocks keep telling us that Tesla isn’t spending a lot of money on expansion….

    Two points:

    1) That $1.6 Billion is why current Model S and Model X buyers get to be at the front of the line for the Model 3. Without their purchases, Tesla wouldn’t be in a position to spend $1.6 Billion preparing for the Model 3. It is called gratitude, and I’m glad that Tesla as a company recognizes that they owe that to their customers who got them where they are today. (disclaimer: I do not own a Tesla).

    2) Tesla’s 2015 Total Revenues were reported as $4 Billion dollars, with a net loss of $888 Million dollars. In perspective, if this $1.6 Billion were put back in, as if it were never spent on upgrades, that would more than wipe out their entire losses, and put them well into profits.

    1. Speculawyer says:

      That $1.6 Billion was just for the Model S & Model X. The factory is in no way ready for the Model 3 . . . they’ll have a to spend a whole lot more for additional equipment (robots, assembly line, dies, etc.).

      As this article points out, they have the ability to handle to painting for the Model 3. And I presume the Gigafactory is going to take over the job of creating battery packs for all their cars. But they have a LOT to do before the Model 3 can be built. They don’t even have the equipment for dealing with steel body parts yet.

    2. sven says:

      Is it “Tesla buyers” who get to step in front of the line or the “current owner of the Tesla”? Would the original purchaser of a Roadster, who no longer owns the Roadster or any Tesla get to be in front of the line, or would he have to go to the back of the line since he is no longer a Tesla owner? If it’s the latter, then it’s more like musical chairs, rather than rewarding buyers who supported Tesla. Likewise, does someone have to own a Tesla at the time the deposit is placed to get in front of the line, or could the deposit holder buy a used Tesla sometime after placing a deposit?

      Regarding point 2, you’re conflating/confusing revenue and expenses on the Income Statement with cash flow on the Statement of Cash Flows. The entire $1.6 Billion would be counted as a negative cash flow, but only less than $200M would be counted as a depreciation expense and Section 179 expense in 2016 that would decrease income.

      The $1.6 Billion in upgrade expenses in 2016 are capitalized, removed from the Income Statement and turned (converted) into assets and placed on the Balance Sheet as Property, Plant, and Equipment, which will be depreciated over 3 to 12 years for machinery & equipment, and 30 years for buildings improvements. (From 2015 10K Annual Report page 57)

      On Tesla’s “Statement of Cash Flows” (2105 10k Annual Report, page 51) you see the $888M net loss from the Income Statement (10K, page 48) is the starting figure to which only $422M of depreciation (a non-cash expense) is added back, and from which $1.6B spent on Purchases of Property and Equipment is subtracted, to arrive at the Net increase (decrease) in cash and cash equivalents.

      On Tesla’s “Balance Sheet,” Property, Plant and Equipment increases $1.6B from $1.8B @1/1/15 to $3.4B @12/31/15 (2015 10K Annual Report, page 47).

      On Tesla’s “Income Statement” the Depreciation expense on the Property, Plant, & Equipment is not broken out and is hidden in the $922M of Selling, General, and Administrative Expenses (2015 10K Annual Report, page 48). But we know that the depreciation expense is $422M from the separate line item on the Statement of Cash Flows. Of the $422M depreciation expense, less than half (<$200M) of it is from the Property, Plant, and Equipment that was purchased (or expenses capitalized) and placed into service in 2016.

      http://ir.teslamotors.com/secfiling.cfm?filingID=1564590-16-13195&CIK=1318605#TSLA-10K_20151231_HTM_ITEM_8

      1. Nix says:

        sven — I am absolutely intentionally conflating cash flow and income.

        That is why I used the phrase “as if”.

        I’m drawing the parallel between the actual spend (regardless of how it was booked), and Tesla’s book losses, and showing that Tesla’s actual spend of $1.6 Billion dwarfs their booked operating losses.

        It doesn’t matter at all how Tesla capitalized that $1.6 B in spending for the purposes of my post.

        Somebody with your claimed great expertise should fully understand that without me having to explain it to you.

        1. sven says:

          I’m sorry, but I’m not following you.

          Tesla spending the the $1.8B on Property, Plant and Equipment resulted in only about a $200M depreciation expense for 2015, lowering income by that same amount. There is no other affect on income or expenses, just the Net Loss increasing by about $200M.

          “If” Tesla never spent $1.8B on upgrades, then it would have a $688 loss, instead of a $888 loss (the difference being the $200M less depreciation expense). Tesla’s entire loss would not be wiped out; Tesla would not be profitable. The $1.8B comes from cash accounts on the Balance Sheet, and would not be “put back in” revenue since it did not come from 2016 sales revenue. It would be put back into the cash account on the Balance Sheet.

          I wasn’t clear, and I think you misunderstood what I meant by “capitalize expenses.” Capitalize is this sense doesn’t mean how a purchase is funded/financed. When Tesla spends money to build/improve a factory by paying for contractors, materials, and labor, it cannot deduct those expenses on the Income Statement to calculate net profit or loss. Accounting rules require Tesla to convert those construction expenses into a capital asset (Property, Plant, & Equipment) which is depreciated (expensed) over time. This process of converting construction expenses into capital assets is called “capitalizing expenses” in accounting lingo. I tried to explain this in my previous comment, but upon re-reading it, I can see that I did not do a good job at it. My apologies.

      2. Nix says:

        In response to your first paragraph, answer for yourself based upon your own ability to fully embrace the concept of “gratitude”, and you will find your own answer.

        1. sven says:

          Those were honest questions, that hadn’t occurred to me until I read your post. I actually don’t know the answer to those questions. I’m sorry if my musings came off the wrong way; I didn’t mean to ruffle any feathers. I’m stuck at the airport with a long delay trying to fly out to see family for the holiday, and was just trying to kill some time on IEVs.

  10. Is this the Model 3?

    https://youtu.be/Z59gr3B0hTU?t=1m49s

    The one with the white bar, that separates black panorama roof an rear window.

    1. sven says:

      At what time stamp in the video?

        1. Properly just a Model S with removed back window.