For the second time since February Tesla said Monday it has temporarily suspended production of its Model 3 sedan, a move that analysts say underscores the enormous challenges for the company to deliver its first mass market electric vehicle.
Model 3 production fell short of the weekly target of 2,500 at the end of the first quarter and a number of Wall Street analysts say they do not believe it will succeed in producing 5,000 Model 3s per week in the second quarter, as Musk has promised.
And for Musk himself, the auto represents the culmination of a plan to supply affordable, widely-available vehicles powered exclusively by electricity.
Reuters reported that Tesla Inc is targeting November 2019 as the start of production for its Model Y sport utility vehicle, with production in China to begin two years later, two sources told Reuters this week, shedding some light on the electric vehicle maker's next project that could tax its resources and capacity.
The statement used the same language during the halt in production earlier this year.
According to Buzzfeed News, Tesla's latest production pause came without warning in the midst of what has already been "production hell".
"This is not unusual and is in fact common in production ramps like this", the spokesperson added.
Nonetheless, he was not surprised by the suspension. Those working on the Model S and Model X were informed to keep up the good work too. "And when you have something that's mass marketed, it's a different ball game".
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An internal company email says the company will boost production to a 24/7 operation by the end of June.
"While further delays would not necessarily "make or break" Tesla, they will invariably exacerbate cash burn", Toni Sacconaghi, an analyst at Bernstein Research, said in a research note Tuesday.
Shares of Palo Alto, California-based Tesla was last down almost 1 percent. Tesla, Inc. (NASDAQ:TSLA) has risen 3.32% since April 17, 2017 and is uptrending.
At the same time, Musk stated "Humans are underrated", implying Tesla planned increased human involvement in Model 3 production.
Musk said he was sleeping at the Model 3 factory so he could get more work done.
"There shouldn't be a question mark as to whether somebody's going to get their vehicle", Musk told CBS This Morning in an interview last week. Way back then, it was said that all this was being done to increase productivity.
BuzzFeed report https://www.buzzfeed.com/carolineodonovan/tesla-model-3-production-shutdown-delay-elon-musk?utm_term=.amBP632vJ&bftwnews#.uyJoVKrlv, citing Tesla employees, said workers were expected to use vacation day or stay home without pay during the four- to five-day production pause.