Model 3 Will Push Tesla To Its Breaking Point
What doesn’t destroy you, makes you stronger…
There’s no denying that fact that for Tesla Motors, the Model 3 is its most important car to date.
A mass-market, long-range, semi-affordable electric car with a Tesla badge is certainly the plug-in we’ve all been waiting for, but will Tesla be able to pull it off?
Automotive News opines that it won’t be an easy task:
“…none of this is what keeps Musk or investors up at night.”
“It’s the Model 3 that does.”
“Tesla’s attempt at a mass-market, long-range electric car won’t have a groundbreaking powertrain or gull-wing doors. And yet this most mundane Tesla product will carry the highest stakes. It will push Tesla to its limits as a manufacturer and test investors’ patience with a perennially unprofitable company.”
To keep to the tight timetable, Tesla will blow through cash as it races to get the Model 3 into production. Any slip up along the way could be catastrophic, as that could lead to investors pulling out, according to several analysts.
“Tesla recorded $295 million in second-quarter capital expenditures and expects full-year capital spending to accelerate to $2.25 billion to support the ramp-up for the Model 3 and its goal of producing 500,000 vehicles in 2018.”
Musk is aware that being on time is vital. During the most recent Tesla conference call, Musk stated:
“I don’t expect us to be at full production on July 1. But I have to drive all suppliers and internal efforts to that date knowing that some will fall short.”
“And those that fall short will be cut out of the picture.”
Basically, either Tesla pulls off the Model 3 with a massive bang, or the electric car maker fails miserably. In a way, it’s getting close to do or die time now for Tesla Motors.
Source: Automotive News