Tesla has achieved a production rate of 1,000 Model 3 a week and now it is all about steadying that flow. Elon Musk said he had walked the line bit by bit last month and asked employees to make keeping the production rate their “top priority”.
The email to Tesla employees was obtained by Electrek and sees Musk calling on staff to keep both quality as well as output high. 7,000 Model 3 are rolling out of Fremont per week at the moment – a goal the electric vehicle maker had fought long and hard for reportedly.
For Musk it is all about stabilising said output in order to move from bursts of high production rates, especially before the end of a quarter, to a a steady flow of electric vehicles. In his email, the CEO pointed to the importance of every piece of the “10,000 unique parts and processes” not only for the production but also cost and ultimately price.
The Model 3 is at a base price of about 38,000 dollars at the moment – a more realistic count is closer to 45,000 or 55,000 dollars – so Tesla has some way to go to reach their initial target of 35,000 dollars per electric car.
Accordingly Musk has made this another priority that is directly related to production. Reads his email: “It’s important to bear in mind that the cost of the car is made up of about 10,000 unique parts and processes. depending on how you count it, the current cost of a standard range Model 3 would be around $38,000, so each part or process step only costs around $3.80. That means finding cost efficiencies is a game of pennies, even though it might not seem so.”
Batteries will play a big role in bringing the price down and analysts from UBS recently found that cells made by Panasonic at the Gigafactory are already 20% more cost efficient than the next best on offer from LG Chem (we reported).