Tesla CEO Elon Musk is not following the traditional production process, in which big companies test a new vehicle’s production line by making vehicles with comparatively cheap tools and prototypes. Instead, the EV firm, which is nearing the launch of the Model 3, is skipping the preliminary step and ordering more expensive equipment to meet the September deadline, notes Reuters.
Why is Musk skipping beta testing?
Musk has been popular for taking greater risks and breaking traditional industry norms. Although there have been other companies in the past that tried to push production on the factory floor, none has been confident enough to trust their strategy very much.
In an investor meeting last month, Musk discussed his decision to skip the beta testing process, saying advanced analytical techniques will help the company move straight to production, notes Reuters. It seems that Musk is skipping ahead in the production process to see how much time and cost in the beta testing process can be cut down.
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According to Consumer Reports’ Jake Fisher, Tesla’s decision to skip the production process is just an “experiment.”
By moving directly to using the final tools instead of starting with lower grade, disposable equipment known as soft tooling, Tesla is trying to avoid the problem which occurred during the launch of the Model X in 2015, a person familiar with the matter told Reuters. The source also stated that soft tooling “did very little for the program and arguably hurt things.”
Te EV firm seems to have learned its lesson and believes in modifying the final production tools. Its 2015 purchase of a Michigan tooling company gives it the ability to make major equipment 30% faster than before and also at a lower price. The EV firm is set to unveil the production version of its mass-market car in July.
Tesla and its Model 3 production goals
As far as its production goals are concerned, Tesla recently raised $1.2 billion and is running towards its September deadline. To start with, the company is looking to produce 5,000 Models 3 cars per week in 2017. In the process, the automaker will analyze the production setup and resolve issues to achieve stable production of 10,000 vehicles per week in 2018.
Tesla has reportedly received several building permits for its Fremont factory, suggesting various activities over the past few months. The company got a total of 26 building permits concerned with modifications to its factory in February and March, according to Electrek.
Several of the permits obtained were related to the Model 3. For instance, the EV firm obtained permits to go ahead with the new stamping press line. Musk earlier stated that the stamping press that was ordered from Schuler could be the biggest hurdle for the Model 3 at this point of time, notes Electrek.
In pre-market trading today, Tesla shares were up more than 1%. Year to date, the stock is up more than 43%, while in the last year, it is up more than 20%.