Submitted by vicsoccer11 on Thu, 2016-04-28 15:57
I just read an article, via Fortune Magazine, that stated Tesla's constrain to produce the Model 3. It stated that "According to estimates from Cairn Energy Research Advisors, Tesla could ship a little over 400,000 of its Model 3 cars by the end of 2020. But before 2020, production of Model 3 could likely be constrained. For example, Tesla could ship 12,200 Model 3 cars in its first production year in 2017, and another 64,660 Model 3 cars in 2018". I was wondering if someone could answer the main challenge in scaling production? I've heard many opinions on the cause; weather it's not enough money, cost of batteries too expensive, not enough resources to produce that many battery packs, still working the details of certain features and quality over quantity. While I am sure all of those are valid reasons I have a hard time believing that those reasons are holding production as far back as 2020. If all 400,000 reservation holders bought $35,000 Model 3 cars, Tesla would have booked $14 billion in orders. That is in my opinion a pretty record setting number for a launch of a product. Money seems to be one of the issues which most people are arguing as a setback to production. Call me ignorant but I would think with that sum in orders investors would be throwing more money to alleviate most of those issues mentioned above. Another issue is the quality over quantity gospel but I believe with the recent difficulties they had with manufacturing the Model X, that they would use the lessons learned from that outcome and be able to produce a well oiled Model 3, without having setbacks all the way to 2020. I sound a bit demanding, I know, I really appreciate what Tesla has accomplished. I just don't buy the reasons to set production that far back. Perhaps I am simply just wrong but I'm just simply looking for a more sound answer.