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Mondo Fuego™
KR: Tesla 3 ... LOL
Sat Nov 4, 2017 10:51am

I know you like giving me a hard time ... I taught you all the skills, and you are doing quite well on your own now.

I will be giving you a hard time when you buy your Tesla 3 ... if they ever deliver it in the first place. You can text pictures to my Kroger Android LG phone of your Tesla 3 stalled on the Lake Pontchartrain Bridge or burning in the Bayou.

Here's what you have to look forward to:

Sleepless nights, broken robots and mounting pressure: Musk offers rare glimpse inside Tesla’s ‘production hell’

Tesla suffered its biggest ever quarterly loss ($619 million) in wake of the Tesla Model 3 production issues. Last month CEO Elon Musk said Tesla only produced 260 Model 3s in the third quarter. Musk said the car was "deep in production hell". (Reuters)

In Dante’s “Inferno,” part of his 14th century epic poem, Hell is portrayed as nine concentric circles of torment, each with its own nightmarish form of suffering.

The allegory is a reflection of Renaissance-era morality, but surprisingly it’s also an apt metaphor for building the most sought-after electric car in the world from scratch.

During a call with investors earlier this week, Tesla chief executive Elon Musk made that much clear as he laid out the challenges plaguing the nearly stalled production of the Model 3, the company’s first mass-market vehicle.

“Let’s say Level 9 is the worst,” Musk said. “We were in Level 9, now we’re in Level 8, and I think we’re close to exiting Level 8. I thought we’d probably be more like in Level 7 by now.”

“And I have to tell you, I was really depressed about three or four weeks ago when I realized we were in Level 9,” he added. “Then we got to Level 8, and now I can see a clear path to sunshine.”

[Tesla reports big loss as Model 3 production struggles continue]

The particularities of the company’s challenge — many of them engineering problems involving robots and battery packs at Tesla’s sprawling Gigafactory 1 in Nevada — may have been unforeseen, but the arduous journey into the metaphorical underworld certainly wasn’t. Minutes after Musk took the stage to introduce the Model 3 at Tesla’s factory headquarters in July, he began warning of the incoming “production hell” a period that would test Tesla, the company’s employees and their leader like never before.

Three months later, Tesla is mired in what is probably the hardest portion of that test, and it’s beginning to show. Minutes after the company reported a loss of $671.1 million for the third quarter, Wednesday, Musk’s voice sounded monotone, dispassionate and a more than a tinge irritable. The company hoped to produce 1,500 Model 3s during that period, but managed only 260. At the moment, however, Musk was concerned with something else. He spent the first part of the call admonishing journalists for suggesting that recent layoffs were linked to production issues, punctuating his uncharacteristic rant about journalistic integrity with a single word: “Shame!”

Musk said a cold was to blame for his catatonic voice, but one couldn’t help but wonder whether the culprit was actually general fatigue. Based on Musk’s own description of the urgency surrounding the Model 3 rollout, it’s not a stretch of the imagination. To resolve nagging production issues, Musk told investors, he’s “reallocated” some of the company’s top engineers to Nevada, where he and his team are working seven days a week.

Musk said he’s there alongside them because he believes in leading “from the front lines.” Amid the pressure, he’s documented his sanity-stabilizing downtime on Instagram, in fact.

“I’ve personally been here on the Zone 2 module line at 2 a.m. on Sunday morning trying to diagnose robot calibration issues,” he said. “I’m doing everything I can.”

“We got it covered,” he added. “It’s just going to take us a few months longer than we expected.”

How long exactly?

It’s “difficult to predict” Musk acknowledged, pointing out that he’s now trying to avoid making production pronouncements that the rest of the world endlessly dissects.

The problems are so complicated that company officials — deeply versed in the company’s automated details — struggle to explain them succinctly, in non-engineering terms. Building a Model 3 involves thousands of processes, they say, noting that the car has 10,000 unique parts. Though the Model 3’s design on the whole is much easier to build than Tesla’s other models, they say, parts of that process are “intensely automated.” The upside of that means that the car’s automated assembly line is shorter and more streamlined than most. The downside (at this stage, anyway) is that the system “is designed as a very tightly integrated” fashion, according to Musk, meaning that when one element of that manufacturing process is broken, the ripple effects are profound.

Either the machine works, Musk said, or it doesn’t. Complicating matters was a subcontractor that failed miserably, he noted, forcing Tesla to rewrite a huge amount of the software from scratch. Minutes later, he blamed Tesla for failing to notice the failure, an oversight that still appears to pain him.

“We dropped the ball,” Musk said, “and did not realize what was dropped until quite recently.”

The timeline and the numbers remain fluid, but here’s the latest: Musk said he expects Tesla to produce 5,000 Model 3s per week by “sometime in March.”

Musk had previously said that the company would reach the same production rate by the end of 2017.

With the company’s profitability firmly staked in the Model 3’s liftoff, those expectations remain exceedingly high and pressure-filled, even if automotive analysts are right about prospective Tesla buyers being more patient and flexible than the typical car buyer. Ironically, the man who has made a habit out of warning the world about the perils of an artificially intelligent future, is already living in a robotic nightmare. The only way out, he maintains, is to keep going.

He’s come this far, after all.

“For the skeptics out there, I’d like to ask them, ‘Which one of you would’ve predicted that Tesla would go from 25,900 units delivered to 250,000 units delivered now?” Musk said, concealing all but a trace of the retributive fury you’d expect to find in a brilliant billionaire. “I suspect the answer is zero.”


Tesla reports big loss as Model 3 production struggles continue

For weeks now, many have wondered whether Tesla had solved the production challenges hampering the rollout of the Model 3, the company’s first mass-market vehicle.

On Wednesday, Tesla provided an answer: Not yet.

“While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear,” the company said in its quarterly statement to investors.

Last quarter — a period chief executive Elon Musk likened the state of the production process to “Hell” — the company said it had only delivered only 222 Model 3’s, a far cry from its goal of producing 1,500.

During a call with investors Wednesday, Musk expressed a mixture of frustration and optimism and noted that despite the low production numbers, he’s finally able to see “a clear path to sunshine.” He declined to say exactly how many Model 3’s Tesla would be producing by the end of the year, but predicted the number would be “in the thousands.”

“I’d like to say the number at the end of Q4, but there’s too much uncertainty right now to give that with any precision,” he said. “We’re like in a vertical climb here so it’s really hard to say.”

There have been about 500,000 reservations for the sedan, which many experts believe is a key to the company’s long-term profitability. But as Model 3 production sputters, Tesla reported a loss bigger than many analysts projected.

The company reported a loss of $671.1 million, or $3.70 a share, compared to a profit of 21.9 million, or 14 cents a share, for the same period a year ago. Revenue was $2.98 billion for the three-month period, up from roughly $2.30 billion a year ago.

The news wasn’t all bad for Tesla. The company said it recently delivered it’s 250,000 vehicles, a development the company called a “significant milestone,” noting that the Tesla fleet is now “about 100 times larger than it was five years ago, just before the launch of Model S.”

Musk said the primary Model 3 production issues are occurring at Gigafactory 1, the company’s massive battery facility in Nevada, where engineers have struggled to automate the manufacturing process. In addition to redirecting some of Tesla’s best engineering talent to the factory, Musk said he is personally attacking the problem alongside his employees.

“I move myself to wherever the biggest problem is at Tesla,” he said. “I really believe that one should lead from the front lines.”

Musk predicted the company would reach 5,000 Model 3 vehicles per week near the end of the first quarter of 2018 — several months later than originally predicted.

The question facing the company now is whether the production issues will bother anyone outside of the industry observers who track the company’s every movement. Jessica Caldwell, the director of industry analysis with the auto research website, said prospective Model 3 buyers have more patience than the average car buyer.

“Model 3 reservation holders may not be thrilled about the fact that they have to wait longer than they thought for their vehicle, but it likely won’t cause them to cancel their orders en masse,” Caldwell said. “Many Model 3 customers put deposits down on the vehicle more than a year ago before they even saw the vehicle, so it’s clear Tesla buyers don’t follow the usual logic-driven car buying process.”

Trip Chowdry, a senior analyst at global equities research, cautioned against investor panic as well. Financial results, he argued, mean little when analyzing the long-term prospects of a company that is creating a new industry.

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