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As someone who works in the car industry in a manufacturing plant, what surprises me is the lack of complexity in their product (especially in the powertrain i.e. battery and motors vs fuel tanks and engines) and yet their inability to ramp up their volume. If you look at most production facilities (at least in Europe) there is usually one line which produces several models, in various body styles each with various different engine/transmission combinations and additional parts for specific emissions markets and climates. (That's just some of the complexity in the Powertrain system, there's more related to the interior, exterior, electrical systems, suspension, HVAC) Tesla's model 3 line has virtually none of this complexity but still has issues in productions. Needless to say, if this was an established automaker producing this line, they would easily be up to full production volumes within months. (For me, this is part of the reason why people in the car industry are bearish on Tesla, they understand the challenge in setting up a whole new production line by a novice to the industry. By the time, Tesla have ramped up to a significant volume at good quality, the VAG, PSA/Opels, FCA, GM, Fords of the world would have their relatively simple (complexity wise) EVs designed and ready to ship (or almost ready to ship)) To me it seems like their current woes are a production quality issue or logistics and planning issue. The Model S was their first attempt at volume production so should have been a good chance to resolve the basic issues, learn from their mistakes and build up good practices. The Model S was notorious for its poor panel alignment, squeaks and rattles and other minor quality issues but things had improved as the production went on. Dishearteningly though, it seems that this wasn't enough. The challenge of producing a low volume product like the Model S really doesn't compare to the Model 3's 6000/week ambitious target. Previously, they could ship a Model S and have their service centers fix all the production issues. At significant volume, you need first time through quality to be almost perfect. For continuous production systems to work, all the processes need to keep to their 'takt time' and also be done to the correct standard (sufficient 'process capability'). Making sure your processes are capable is the hardest part and where your Six Sigma (Master) black belts are worth their weight in gold. The other thing they need is suppliers delivering on time and to spec. Logistics planning also is huge, with delays in supplier shipments potentially stopping the whole line. Supplier quality can also be an issue so having your own knowledgeable engineers working with them is key. They have a huge task ahead and everyday they build below target, they are burning millions of dollars of revenue potential. |