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Technology Stocks : Investing in Exponential Growth

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From: Paul H. Christiansen4/3/2018 10:25:58 AM
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Tesla’s Musk Takes Charge of Model 3 Production as Problems Persist

Tesla’s struggles to manufacture its flagship Model 3 electric sedan reached a boiling point last week, prompting CEO Elon Musk to take direct control of the division producing the vehicles, according to two people briefed on the matter.

The move came after Tesla failed to hit its goal of making about 500 Model 3 sedans per day, or 2,500 per week, by the end of March. Mr. Musk appears to have pushed aside the company’s senior vice president of engineering, Doug Field, who had been overseeing manufacturing in recent months. Until the move by Mr. Musk, Mr. Field had been consolidating power since joining Tesla from Apple in 2013. Mr. Musk had given Mr. Field several chances to raise output, but the company has repeatedly missed its Model 3 production targets over the past year, including after Mr. Field took over manufacturing.

Earlier this year, for instance, Tesla temporarily shut down Model 3 production that Mr. Field was overseeing while Tesla’s plant that makes battery modules for the car continued to ship battery units, one of these people said. The move gave the production side of the company a greater supply of batteries and the chance to show how quickly it could move with them. When that didn’t appear to make a big difference, several weeks ago Mr. Musk authorized the removal of some conveyor equipment at the company’s Fremont, Calif., plant that was contributing to a hold-up in delivering car parts to the production line, this person said. But that shift also failed to help speed up Model 3 production enough to hit the target.

In a brief statement, a Tesla spokesman said: “Model 3 production is the highest priority at Tesla, so Elon is focusing his time there while Doug focuses on vehicle engineering.” He did not comment further.

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