Tesla Motors Inc (NASDAQ:TSLA) has apparently halted production at its facility in Freemont, Calif. Bloomberg reports that a spokesperson said in an interview that they are enhancing the factory to speed up production of their Model S sedans and also prepare it to produce the Model X crossovers.
Tesla reconfigures plant
The automaker reportedly plans to resume production on Aug. 4. The Tesla spokesperson said their goal is to boost production by 25%. He added that the improvements they are making to the facility include changes to the assembly lines, which will cost the automaker approximately $100 million to complete. He also said that this is Tesla’s “single biggest investment” in the factory since it began operations. After the reconfiguration, he said they will be able to build the Model X crossover on the same line as the Model S sedan. Deliveries for the Model X are expected to begin early next year.
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Tesla Motors CEO Elon Musk is targeting a minimum of 35,000 Model S sedan deliveries this year, which would be approximately a 56% year over year increase. The automaker started shipping cars to the U.K. and China during the second quarter, so it desperately needs to speed up production in order to keep up with demand. Tesla will also adding Hong Kong, Australia and Japan to the countries to which it is delivering cars in the second half of this year.
Tesla targets 1,000 cars a week
Musk has said in the past that they want to expand their factory’s production capability from the 700 cars per week at the end of the first quarter to 1,000 cars per week later on this year. Tesla spokesperson Simon Sproule said before the current project, the automaker was nearing 800 units a week. While Tesla is retooling the factory, workers are allowed to either take vacation time or report to the plant for training and maintenance.
Meanwhile Tesla Motors continues to move forward in the process to choose a site for its planned gigafactory. Sproule would not say when they will release the location of the facility. The automaker must find a way to reduce the price of its battery packs in order to lower the cost of its cars in time for the Model 3, which is expected to start out at $35,000 and target the mass auto market.