By Tyler Durden, June 27, 2018
Bears and bulls alike following Tesla’s gripping nailbiter of a story – the company has until the end of the month to pump out 5,000 Model 3 sedans a week – both agree on one thing: the output of the company’s new “tent” structure which Musk erected recently to produce Model 3 vehicles is going to decide whether or not the company hits its production goal that it has touted over the last couple of months.
The tent was erected in just a matter of weeks, and came online in early June, to help the company produce more vehicles at a time when they are under the microscope. Until recently, we didn’t know the details as to when it was erected, what the timing looked like and what it is expected to produce. However, a Bloomberg article helped shed some light on the details of what is arguably the most important – if archaic – structure that Tesla has built yet.
Not surprisingly, opinions extend the whole gamut, with some manufacturing experts claiming the tent is “basically nuts”:
Elon Musk has six days to make good on his pledge that Tesla Inc. will be pumping out 5,000 Model 3 sedans a week by the end of the month. If he succeeds, it may be thanks to the curious structure outside the company’s factory. It’s a tent the size of two football fields that Musk calls “pretty sweet” and that manufacturing experts deride as, basically, nuts.
Inside the tent in Fremont, California, is an assembly line Musk hastily pulled together for the Model 3. That’s the electric car that is supposed to vault Tesla from niche player for the wealthy to high-volume automaker, bringing a more affordable electric vehicle to the masses.
Analysts at Bernstein are equally unimpressed. Here is a quote from Max Warburton who benchmarked auto assembly plants before his job as a financial analyst: “Words fail me. It’s insanity,” said Max Warburton, who benchmarked auto-assembly plants around the world before becoming a financial analyst.
Ironically, Musk’s “Hail Mary” is the polar opposite of Tesla’s own vision for its future of state of the art robotics, hermetically sealed manufacturing facilities and millisecond efficiency.
To be sure, the tent is also a far cry from the automation that investors were promised during the early days of Tesla. The company‘s goal, which once was to have a state of the art factory producing vehicles, has now been reduced to a literal tent using manual labor and spare parts to put together cars. Worse, nobody seems to even know whether or not the line is up and running. Welcome to the future?
Musk announced it on Twitter on June 16, saying the company had put together an “entire new general assembly line” in three weeks with spare parts; the building permit was issued on June 13, though the company could have started working on aspects of the project before that.
Whether this new line is fully operational is unclear. Company officials declined to comment. The Tesla-obsessed users of Twitter and other internet forums have posted photos and videos and comments either praising or ridiculing the parking-lot big top. Apparently in response to the intense interest, the tent has recently been surrounded by very large trucks, which obstruct the view.
Predictably, the tent is being called a “hail mary” move by analysts, after the company finally admitted that its vision for automation and assembly – pitched as the “most sophisticated in the world” as recently as February 2018 -was simply “not working”:
What gives manufacturing experts pause about Tesla’s tent is that it was pitched to shelter an assembly line cobbled together with scraps lying around the brick-and-mortar plant. It smacks of a Hail Mary move after months of stopping and starting production to make on-the-fly fixes to automated equipment, which Musk himself has said was a mistake.
“The existing line isn’t functional, it can’t build cars as planned and there isn’t room to get people into work stations to replace the non-functioning robots,” Warburton said in an email. “So here we have it—build cars manually in the parking lot.”
As Bloomberg notes, an April admission that he erred by putting too many robots in Tesla’s plants was a humbling moment for Musk. The chief executive officer had boasted in the past that his company would build an “alien dreadnought,” sci-fi bro code for a factory so advanced and robotic, it would be incomprehensible to primitive earthlings.
During a February earnings call, Musk told analysts that Tesla had an automated-parts conveyance system that was “probably the most sophisticated in the world.” But by the spring, it had been ripped out of the factory.
“We had this crazy, complex network of conveyor belts,” Musk told CBS This Morning in April. “And it was not working, so we got rid of that whole thing.”
Analyst Dave Sullivan, who previously used to supervise Ford factories and now works at AutoPacific, chimed in: “To say that it’s more efficient to build this with scrap pieces laying around means that either somebody made really bad decisions with the parts in the plant inside, or there are a lot of other problems yet to be discovered with Tesla’s efficiency.”
The article concludes with what may be the most suitable epitaph for Tesla should Musk disappoint in a few days when he reports Q2 production figures.
“It’s preposterous,” Bernstein’s Warburton said.
“I don’t think anyone’s seen anything like this outside of the military trying to service vehicles in a war zone. I pity any customer taking delivery of one of these cars. The quality will be shocking.”
Preposterous or not, the clock is ticking on Tesla.
The company has just days before it has to update investors on the current state of production and how the business is running. If the tent is any indication, expect many to voice their disappointments out in the open…
Read more at www.zerohedge.com
Study: Tesla Cars Just As Dirty As Gas And Diesel
By Jason Hopkins
A study has found electric vehicles manufactured by Tesla are no better for the environment than diesel or petrol-fueled cars.
Despite being recognized as among the most environmentally friendly on the market, Tesla vehicles harm the planet just about as much as their diesel and petrol equivalents, according to a recent analysis by Engaged Tracking, a London-based research firm.
Engaged Tracking determined that the production of Tesla vehicles — and generating the electricity to keep them running — contributes to greenhouse gas emissions just as much as traditional vehicles in the United Kingdom.
This is because more CO2 is emitted during the manufacturing of electric vehicles, and the electricity Tesla vehicles in the U.K. require are generated mostly by coal and gas.
“Teslas are not cleaner to run than the average car in the U.K. The annual emissions of a U.K. car is 1.5 tons of carbon dioxide, based on an average of 7,800 miles a year,” Engaged Tracking’s chief analyst Jonathan Harris said to the Sunday Times. “Both the Tesla Model S vehicles we analyzed have the same emissions as an ordinary petrol car of 1.5 tons of CO2 per year.”
However, Tesla quickly pushed back on the group’s findings, claiming the comparison of a Model S — a larger model — to an average vehicle is not fair.
“It makes no sense to compare Model S to the average annual emissions figure for cars in the U.K. because that average includes a lot of smaller models that are dissimilar to Model S,” said a Tesla spokesman. “Any fair analysis shows that electric vehicles like Model S and Model 3 generate far less CO2 per mile than any comparable gas-powered car.”
This isn’t the first time a study has determined electric vehicles to have no substantial benefit for the environment.
The Manhattan Institute published a report in May that analyzed the cost of electric automobiles and their effectiveness to clean the environment.
The Institute’s findings were quite notable: electric cars actually increase the amount of pollution into the atmosphere compared to new internal combustion vehicles.
Read more at Daily Caller