Currently, we’ve been responsible of the identical conduct as loads of different well-rounded and goal automotive publications — bashing Tesla Motors. It hasn’t been accomplished maliciously, however we’d be mendacity if we mentioned the divisive hype and hate surrounding the corporate didn’t hassle us. Nevertheless, for the reason that summer season launch of the Mannequin three, a slew of happenings at Tesla have have raised unanswered questions.
The largest query surrounds the reason for the corporate’s relatively extreme manufacturing delays. Tesla additionally fired tons of of workers this month, with none clear reply as to why, and appears to have shelved a cross-country journey aimed toward highlighting the progress made with its Autopilot driver help platform.
None of this might be fairly so noteworthy if its inventory valuation wasn’t nonetheless stratospherically excessive and CEO Elon Musk hadn’t publicly promised a lot — however that isn’t the truth we’re dwelling in. Now, with the corporate reporting its third quarter earnings on Wednesday night, we’re hoping to get some readability on what precisely is occurring in Fremont, California.
Earlier this month Tesla reported that it had solely constructed 260 Mannequin three sedans within the third quarter, regardless of forecasting 1,500 models in the identical timeframe. Citing “manufacturing bottlenecks” as the explanation, the automaker hasn’t given any further explanations for the meeting delay. Bloomberg, additionally eager for solutions on this weeks earnings report, mentioned Musk was “tenting” on high of the corporate’s Gigafactory exterior of Reno, Nevada, and speculated that the issue might be a battery provide subject.
Taking a step again and Tesla’s manufacturing objectives compared to well-established producers doesn’t encourage loads of confidence, even below idyllic circumstances. The corporate is attempting to blow up into high-volume manufacturing at a tempo that’s troublesome to understand, and with out a clearly outlined path to get there. With delays ongoing, shareholders want extra solutions and fewer self-promotion.
One such answer might stem from including a manufacturing facility in China. In June, Tesla mentioned it’s “working with the Shanghai Municipal Authorities to discover the opportunity of establishing a producing facility within the area to serve the Chinese language market.” That deal was anticipated to have solidified into one thing tangible by the tip of the yr, however we’ve but to listen to something.
We additionally haven’t heard a lot relating to the corporate’s staffing points. The agency has misplaced important members of its Autopilot workforce, probably stalling autonomous improvement plans and explaining why we haven’t heard something about enhanced options shortly. However it additionally reportedly fired a big hunk of its manufacturing workforce in California this month. Whereas Tesla stays considerably tight-lipped on the reasoning behind it, the United Auto Employees has filed a federal grievance claiming the layoffs have been a results of Fremont-based workers supporting efforts to arrange.
When questioned as to the validity of the UAW’s claims, Tesla finally acknowledged that the terminations have been a part of a efficiency evaluate course of. “At Tesla, we try to be a good and simply firm, the one form price being,” a spokesperson mentioned in an e mail. “Efficiency opinions end in promotions and sometimes in worker departures. Nobody at Tesla has ever or will ever have any motion taken towards them based mostly on their emotions on unionization.”
Nonetheless, the layoffs got here as a little bit of a shock from an organization striving to bolster quantity and maximize manufacturing hours. Nevertheless, if these workers have been lifeless weight, shedding them wouldn’t essentially be a crushing blow.
Maybe the largest conundrum is that of the corporate’s financing. Whereas we all know Tesla had round $three billion in money on the finish of the second quarter, we additionally knew that the Mannequin three was going to be a six-month cash pit. There was no manner it couldn’t be. However, with particular person supply wait instances stretching to the tip of subsequent yr and no phrase but on how the corporate plans to unravel its manufacturing downside, we don’t understand how lengthy this money burn goes to final.
Hopefully, Tesla can present the general public with some clear solutions in tomorrow’s report, as a result of we actually might use them at this level.