Tesla posted blockbuster production and delivery figures in the first half of 2023. But manufacturing might slow down in Q3, as CEO Elon Musk suggested during the Q2 earnings call last week. And the first signs of this slowdown have emerged at the Fremont factory in California.

Even though Tesla maintains a target of 1.8 million deliveries this year, factory upgrades will cause summer shutdowns, said Musk. The company is possibly upgrading the production lines for the refreshed Model 3, also unofficially known as Project Highland – we’ve seen several spy shots of the prototypes around California recently.

Rumors suggested that the updated Model 3 would be manufactured at Gigafactory Shanghai, but a Chinese digital newspaper reported that Tesla China denied those claims. If that’s the case, we’d like to keep our eyes on the Fremont factory because that’s the only other facility that manufactures the electric sedan, other than Gigafactory Shanghai.

Drone footage of the Fremont facility shared by a YouTuber also indicates that operations have slowed down. Logistics lots appear deserted, and entrances to those lots seem to be shut, while haulers are nowhere in sight, as per Teslarati. There’s minimal activity in the casting and manufacturing sections as well.

Currently, Tesla is building the pre-production Cybertruck for validation and certification. The brand expects low-volume production to start towards the end of this year, while manufacturing will scale up at the beginning of 2024. It’s possible that Tesla could be retooling the Fremont factory for the electric truck as well.

Reports surfaced in May 2023 that the company would demolish multiple equipment, tools, and utilities, at the Fremont factory. Tesla hasn’t confirmed any of the aforementioned speculations.

The Model 3 sold like hotcakes in the US in 2022, bested only by its crossover sibling, the Model Y. In the first half of 2023, combined sales of the Model 3 and Model Y have shattered Tesla’s own records.

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