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Crazy speculation: what if Tesla surprises us and manufactures the Model 3 sooner?

Crazy speculation: what if Tesla surprises us and manufactures the Model 3 sooner?

I believe Elon is a man of introspection, who reflects on his mistakes and tries to correct. After being criticized for being late during the Model X reveal, he was very promptly on schedule during the 3 reveal. The mea culpa for the Model X "hubris" was on the press release. He expressed surprise for the huge volume of reservations for the Model 3. Instrospection worn on the sleeve.

Tesla knows it is now on a race and I suspect they might be secretly mobilizing their manufacturing resources to surprise us with an earlier release of the Model 3. Do you think this ability is possible?

dnland | April 15, 2016

Since Tesla will be heavily reliant on third party parts sources, I would be surprised if there is a lot they could do to shorten an already ambitious timeline but I'd be more than glad to be wrong here.

carlk | April 15, 2016

I'd be very happy if Tesla could begin delivery in late 17' as promised. It could plan on bigger and faster ramp up though.

dsvick | April 15, 2016

As much as I'd like that, I don't think it'll happen. I think rushing something and coming out with it early and having problems would be worse than being a little late. There are enough haters and nea sayers out there that no matter what happens they will find fault with every little complaint and giving them the ability to say "They rushed it and released something that wasn't ready" isn't needed.

Delivering a quality product, on time, and on budget is hard enough to do, and if they can do that it would be perfectly sufficient.

I would not be surprised however if they ramp up production much faster than they had initially intended.

PaceyWhitter | April 15, 2016

That would be very cool. I still expect and will be fine with a delay.

Chunky Jr. | April 15, 2016

At the intro he said he was reasonably confident (or similar) that they would go into production by end of 17. If there was a chance to pull that in, he probably would have been more certain with his prediction.

vp09 | April 15, 2016

I'd have to say yes. No one thought Musk could do in the first place what he's already done.

Also, the giant GM/Toyota factory in Fremont that he got for essentially free ($42 million) is mostly empty space, right?

Set up a few dozen more giant robots, hire a couple thousand more workers, and ...

vp09 | April 15, 2016

How about this analysis: Extrapolate the lateness of each vehicle thus far, and project that trend.

What was the difference between the predicted first delivery of the Roadster and the actual first delivery?

What was the difference between the predicted delivery of the Whitestar / Model S and its actual first delivery?

Same difference for Model X?

Now plot those 3 points with the X axis as the model (3 nominal values) and the Y axis as time between predicted delivery and actual delivery (lag, or delay).

You could then extend the line or curve to predict the delay for the 4th model.

My guess is that you would see a curvilinear function with asymptote approaching soon.

It takes a lot of time to ramp up to build one car, but less to produce a second model, and even less to switch to a third, and so on.

Thoughts?

MarlonBrown | April 15, 2016

I think it could be possible to run a pilot production in 2017. Then get ready to ramp up to 3k/week early 2018. If so, that would a great achievement.

carlk | April 15, 2016

@vp09

There are already more than 600 robots in the plant producing S and X.

vp09 | April 15, 2016

Alright then a few hundred more.

bb0tin | April 15, 2016

I do not want Tesla to bring the production forward. Tesla needs to cater for the increased volume requirements, not make the introduction earlier. This is best done by initially producing the Model 3 in a method which can be rapidly multiplied. This will involve proving the entire supply/manufacturing/delivery/service/supercharger chain and then duplicating it. I therefore expect Tesla to announce new gigafactories and new production facilities, and not an earlier first production run.

Red Sage ca us | April 15, 2016

A limited release, if only to Tesla Motors employees, beginning around July 2017 would probably be a good idea if they can manage it.

DonS | April 15, 2016

I think they need all that time to develop the efficiency improvements needed to make the car profitably. The gigafactory is as big part of this since they could not make any money using today's battery in the Model 3.

warren_tran | April 15, 2016

Setting up robot assembly require programming/tool/die. That is not as easy people like to think especially for a brand new model hasn't been finalized.

I would be happy to take delivery in Q1 of 2018. No need to rush since I rather drive a quality finished product

PhillyGal | April 15, 2016

I'm with @carlk - late 2017 is fine but a much quicker ramp up for the early quarters of 2018 would be great. Particularly if they can plan S/X deliveries such that their 200,000th car is delivered January 1st, 2018, being able to produce 100k Model 3s in the first two quarters of 2018 would be YUGE!

jordanrichard | April 15, 2016

vp09, you can't compare the 3 previous models to the M≡. Each of those, especially the MX are far more complicated to build. So I am of the same thinking as the OP. The M≡ is being/has been designed to be easier to manufacture. I think they realize that they will have to finalized things about the design sooner than expected so that they can get their suppliers to start making the parts. I think to make things go faster, production wise, the color choices will be the same as the MS and MX.

TaoJones | April 15, 2016

On time delivery would be just fine, with Q4 2017 slated for employee deliveries and Merry Christmas to them.

And, as PG notes, leveraging in any and all ways the longevity of the full tax credit would be a Good Call. Even if it means skewing deliveries overseas for a calendar quarter - whatever it takes, since once that compelling tax credit is gone, it's gone (ok, it's halved and then halved again, but the point remains).

For bonus points, there's still time yet to move to Colorado in order to have a full year of residency prior to taking delivery of that M3. No, not for the legal weed, but for the additional $6,000 in state EV incentive. $13,500 off a $42,000 car (estimated out the door average price, sans tax as applicable) is a nice healthy chunk for anybody.

Get it while you can.

KevinR.co.us | April 15, 2016

Deliveries starting "on time" in late 2017 would be great. It was hard waiting 18 months for my S. Tesla "hitting it out of the park" on the first at bat was no accident. I think the production ramp up after the release of the 3 will be exponential. They need the time to build the machine that builds the machines.

cephellow | April 15, 2016

I don't think Tesla will move up the timeline, but 400,000 reservations will really improve Tesla's odds of meeting the proposed timeline.
The 400,000 reservations will prove to Tesla third party suppliers that there will be actual immediate high volume demand for their components, and they will de-risked when they accelerate tooling and automation development to produce those components.
Same is true for raising additional capital and establishing vendor credit.

Ross1 | April 16, 2016

7 delivered cars by New Years Eve, 2017. For friends and investors, and himself.

Ross1 | April 16, 2016

If you asked me what I really think, and you didnt, it is this.

Elon and TM got a big surprise with the qty of preorders.
Therefore , so did the supply gurus. (I used to be one).
They were preparing suppliers for X amount, when Y is ordered.
Some cannot and will not perform.

How the ding dong then can they align extra duplicate suppliers or press the chosen ones to upramp early?
Wont happen. They all need new factories , new management, new tooling, to produce this phenomenon called Tesla Model 3.
Can't, won't happen.
But then you didn't ask me.

bb0tin | April 16, 2016

@Ross
The ramp up is not going to happen for 2-3 years. This is plenty of lead time for suppliers to get their act together.
Can happen. Will happen.

eandmjep | April 16, 2016

I agree with Reds Idea. An early limited release to get some out and work out any bugs. Then Ramp up.

I think all the suggestions for improvements are great but many of them will require more parts, more vendors, more R&D, more Time! I like the front end, don't need another hatchback (I have a Truck and wait for a TM version:) The 15" display I could get used to, and a HUD?, More R&D, more vendors, more hubris. I know they will take this time they have to make improvements and that the production of this model is said to be simpler than the S or X. hint: They need to keep it that way. Programming is easy, gadgets have to be built by someone.

Ross1 | April 16, 2016

@bb:
Early rampup means lot less than 2-3 years. 2017 scheduled. Early is 2016/7.
Can't happen

bb0tin | April 16, 2016

@Ross
No. Production is not going to start until late 2017. The big ramp up will not start until a while after that, which makes it 2-3 years. Care to make a bet it will absolutely not be 2016? I will even give you 2 to 1 odds.

dnland | April 16, 2016

I would doubt that there are few cars delivered before 3rd quarter 2018, with 100k plus annual production not occuring until 2019. Too many moving parts and too many factors that Elon won't be in control of. I think @Ross is probably right on...unfortunately.

Haggy | April 16, 2016

Tesla can do some planning ahead of time, but only to the extent that it's not related to final design. If they want to put robots in place knowing that it would be the same robots no matter how they end up being programmed, that's an option that will speed things up later, but they can't do a good portion of it until they come up with the final design. But there should be some overlap with designing and sourcing parts. They have a lot more pull than they did with the Model S because it's much easier to go to a third party and mention an initial queue of 400,000 with many more orders expected later than it was when they needed to buy parts for tens of thousands of cars at the most, without any guarantee that they'd be in business long enough to make 1000 cars. On the other hand, they may find in that process that some design changes would make sense with respect to getting certain parts, and feel that it makes more sense if it will speed things up.

Once the assembly process gets started, they will figure out what's optimal. But it will take a few cars before they get there. It might turn out that reordering parts of the process would be better because one thing is easier to do before something else is done or that a bottleneck could be eliminated by changing order. When they really get things going, then they can think about additional shifts and parallel assembly lines. Even if it's just a matter of catching up, they might feel that it's a good long term strategy if an additional line could later be used for the Model Y or something else.

Ross1 | April 16, 2016

They are going to be 3D printed in Space in a gravity free environment so nothing will hold them down

Why SpaceX has to prove the arrival of Model 3 does not sink the ship.

Red Sage ca us | April 16, 2016

Haggy: +1! Exactly. They have to build evaluation cars anyway (crash test certification, et al). They have to build demo/loaner cars anyway (for distribution to Tesla Stores/Galleries and Service Centers). They have to build the employees' cars anyway. Get all that done while 'figuring it out'... Then begin Production at the fastest rate possible. Start the ramp at a higher point than ever before, and build to a much higher point in a shorter period than anyone thinks possible.

bb0tin | April 16, 2016

@Ross
I guess that means you will not take me up on my offer of a bet.

@Others
For at least a couple of years, Tesla were expecting on producing 500,000 cars a year by 2020. They were also thinking that they may end up making millions of cars a year after that. Large scale production of cars was therefore already in Tesla's planning before the Model 3 reservations. Tesla was expecting 1/4-1/3 of the reservations they got. They only thing that has changed is the magnitude of the reservations, meaning that they can bring their mass production plans forward. They always had plans for this mass production. They can handle it.

Red Sage ca us | April 16, 2016

bb0tin: +1! I concur.

Son of a Gunn | May 4, 2016

Called this one, gents and ladies.

suresh7745 | May 4, 2016

100K model 3 deliveries in 2017. wow. i might actually get my car beginning of 2018. wonder if they will give us an option to pick base model during first year deliveries.

Red Sage ca us | May 5, 2016

Son of a Gunn: +42! All hail he that puts forth reason and logic!

How can I possibly be the man... When U DA MAN?!?

bj | May 5, 2016

@Son of a Gunn - gotta tip my hat to you on this one. I just hope that EM hasn't been drinking too much of his own koolaid... get our hopes up, only to later have them dashed on the cruel rocks of reality.

My hope and dream was that I would get my RHD Model 3 in 1Q 2018. That doesn't seem so fanciful now.

dsvick | May 5, 2016

Hey now wait a minute, your initial post said earlier "release", initial deliveries are still late next year, they're just ramping up production faster. :)

millsdmb | May 5, 2016

If they do, I'll have to buy out my Volt lease early.

Nexxus | May 5, 2016

@dsvick,

With Elon hopefully wishing to deliver 110K Model ≡'s by year end of 2017, when do you think they'll be making them/delivering them? They can't make that many overnight, hence, the earlier "release" Son of a Gunn spoke of.

Nexxus | May 5, 2016

Sorry, I meant 100K, not 110K.

Haggy | May 5, 2016

Tesla already stated that to ramp up production early and get the factory ready to build 500,000 cars a year would cost .75 billion dollars more than originally planned. Considering they got 14 billion in pre-orders the first week, the extra expense might look bad on the balance sheets for another year but will be a drop in the bucket compared to expected revenues. It's safe to assume that since they were planning to ramp up all along, even though they had a target date of 2020, they must have been working on how they would do that in a manner consistent with their plan. So it's not as if they are first looking into how to do this.

If Tesla stays on target but starts production with a significantly upgraded factory, there won't be a big problem. If they get many orders after part two of the reveal, then the money from reservations will go a good way toward paying for the upgrades to the factory.

I figured that they might get 100,000 orders once they did the announcement. They did significantly better, and what came over the following week was beyond what anybody expected. Tesla also expected the orders to double when part two of the reveal happens. This time, I'm less optimistic. It might increase excitement and might not result in many cancellations, but it doesn't strike me as likely that somebody who didn't put a deposit down (who is a more cautious consumer) would suddenly feel comfortable doing so with a potentially much longer wait of perhaps an extra year. I think continued demand will be there, and there might be a smaller wave of new orders once part two of the reveal happens, but I expect a much bigger wave of orders to come 74 days after the cars start coming off the line, give or take two weeks.

Red Sage ca us | May 5, 2016

If the target is 100,000 to 200,000 units of Model ☰ to be built during 2017, that means they may expect to begin Production at a higher rate than I had thought. Even if they took 25 weeks to do so, that would be 4,000 to 8,000 per week. Over 16 weeks it would be 6,250 to 12,500 units per week. Over 12 weeks it would be 8,333 to 16,666 units per week.

In any case, it does seem that 4,000 per week is the baseline minimum, just as I had thought. If they do that for only 12 weeks they'll have built around 48,000 units. And assuming ~83% of those all reach US buyers before the end of the year, that will be 40,000 Deliveries. Still a lot more than 'just a handful' or 'only a token' as Naysayers and Doomsayers like to claim.

carlk | May 5, 2016

I agree with @dsvick. It's not earlier release but a faster ramp up. I don't think anything is said about deliver the 3 before Q4 17' as originally said.

Red Sage ca us | May 5, 2016

If someone gets their car in November 2017 who previously would have got it in June 2018 that qualifies as 'earlier' in my mind.

jordanrichard | May 5, 2016

Here is a simple question. Everyone keeps throwing around "end of 2017", which obviously came from Tesla themselves. Ok, so exactly what constitutes "end of 2017". If that means the last quarter, well that would mean Oct-Dec. They are shooting for Jul and obviously building in a buffer for supply glitches, but that makes deliveries in the Oct time frame seem possible.

Red Sage ca us | May 5, 2016

It seems that of perhaps 28,000 Reservations as 'The 7%', US Tesla owners represent around 16,800 of them. At 4,000 units per week Production, they would probably all have their cars well before year end in 2017. Congratulations!

Badbot | May 6, 2016

Elon said suppliers have a target date of July 1. and that are relocating ( 1 million sq.ft.) warehouse and some other things from Freemont to Livermore to help ramping up production. the late in 2017 is now mid 2017 several months earlier than stated before. Looks like they are going full speed ahead to be able to deliver our M3's.

I'm so excited! i'm in calif. and looking to add options! 4/3/16 confirmed deposit. GO TESLA!

MarlonBrown | May 7, 2016

Ed, I am not sure you want to be one of the first receiving a new car modek which has been rushed to the production line. Potential glitches.

Badbot | May 7, 2016

MarlonBrow, No problem there.
The first run is to the employees so they have daily bug reporting and access to the car with the issue.
I would guess that they are asked to drive it to work any day there is an issue.
I also guess the QC team is on site to examine the issues and find a fix for it.

Next My res was on the 3rd so I am about #280,000. But I am in California so I think I get closer to the front of the line.

Bubba2000 | May 8, 2016

There will be critical items in building the factory, Model 3, and the GF plus raw materials. Some of these are commodity items like steel, Al sheets, glass, Cu wiring, etc. Other items may be unique. Even commodity stuff like Li may be hard to get in quantities. Inverter components, etc. All at low prices.

The more I think about it, I realize the timeline and volume goals are indeed challenging.

Obi Wan | May 25, 2016

1. Which of the previous delays, would affect the Model ☰ ? 2. Mid 2018 works for me, 'cause the longer it takes, the higher my down payment will be and the more cowbells I can afford..

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