Can they meet production targets?
Can they maintain product quality while they scale?
Will they run out of money before they solve the CapEx intensive, low margin problem of automobile manufacturing!!!?
Despite the scrapiness of the "build a gigantic tent" story it's a bizarre risk.
Musk's desire for full vertical integration obviously mirror's that of Steve Jobs - who ALWAYS claimed a core apple advantage was total vertical integration.
But at Apple with the iPhone Job's knew he was outgunned by manufacturers and OEMs by a long shot.
And calculated that building fabs, plants, etc required a different set of skill sets and capitalization than he had at the time.
Where Jobs was a genius was that he maintained control over core manufacturing innovations (machining) and IP, while actually taking on very little manufacturing risk.
There's a really fascinating overview of this, published in 2011 and key quote
"China made Steve Jobs' revenge possible. Chinese OEMs could produce plenty of iPods, iPhones and iPads to meet demand, leaving Apple free not only to design as it wished, but to control what it designed."(1)
I wish for Tesla's sake that they'd taken a similar path, and I think a likely outcome on the downside of the Tesla story is a restructuring around a model like the above.
In the meantime I'm still rooting for them!
(1) https://www.thestreet.com/story/11737628/1/apple-and-the-ver...
One reason for Tesla's vertical integration may be that they want ordinary components like seats done Their Way, but they don't buy in big enough quantities to get major suppliers to do that. This is why you see a lot of high-end but low volume cars with Recaro-branded seats.
Now they're operating a temporary manual assembly line in a tent? This indicates much bigger problems. And a coverup of them.
Ouch, that is scathing, proof will be in the pudding though. If there are a lot of QA issues (which it seems reasonable to assume) then the recall rate + bad press might sink them. It's a scrappy (maybe desperate?) move, one which you would expect from an underdog, so good luck to them.
Nothing in this Bloomberg article reflects reality.
- chaotic/desperate or
- pragmatic and brilliantly subversive of the status quo.
I'm sure we'll get lots of articles painting both sides. Time will tell which one of the two it is.
Seriously this Bloomberg article seems just as a scare write up to drop the share prices...
Can we ratchet down the Tesla hysteria a few notches?
This is absolutely insane. The thought of making workers assemble cars in a tent in Fremont with no AC in the middle of summer is just mind-blowing. That thing is going to get over 100 degrees every single day. I think Elon finally lost me on this one.
> “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.”
When the journalist abandons fact checking and simply goes with publishing this kind of tripe, the reader has no other option but to disregard everything the journalist, their editor or the publication touches.
Once upon a time I worked as an 'aircraft mechanic' for both L3 communications (US Navy contract) and Boeing (US Airforce contract) out in Texas. Both jobs required the removal of the wings of larger aircraft (P3 orion, 737).
Some times we had a hanger and sometimes not. It was pretty brutal, but back then in my youth I'd take the 110* heat over the cold winter. You were miserable and sun burnt in the heat, but the cold low humidity winter was PAIN. Skin on your hands would start cracking open, along with the skin on your mouth and you'd be getting blood everywhere. A lot of our time was spent inside the wings. Hard enough with just a t-shirt on, but really difficult with large down jacket on... Usually I'd have to just leave the jacket off and bare it out. Even worse was inside the wing was considered a 'confined space' by OSHA so that mean you were supposed to have a duct in there with you blowing fresh air. But in the winter I'd take breathing in fumes and sanding dust over cold air blowing on me...
All in all, we'd pull the wings, disassemble large portions of them depending on the contract and then reassemble with replacement spars, ribs, etc. We did it, and the planes are still flying (I guess) so I don't see why something similar can't be done in the auto world. Of course I guess the difference is the government was paying the company about $180/hr and the company gave us $22/hr, so they had money coming in..
My guess is that Tesla is pushing the cars through the body shop, paint shop and then partially pushing them through whatever their analog would be to the chassis line in a standard factory. That line would be far simpler in an EV. Together those comprise three fifths of the assembly line, with only Trim + Final car left, which are the two fifths of the assembly line that would be easy to relocate to the tent, since most of the stations are human operators using hand tools. That's where most of the material and parts handling is and sounds like where their conveyor belt problems were.
The first two lines are totally automated and have been in all factories for 20+ years. As far as I'm concerned if they can run the first three fifths of the line at 5000/week then they will have made it.
Elon is a hell of a leader. If I was a short, I'd have covered weeks ago.
Subaru, for example, would have been a bargain.
It's an awesome idea though. I wonder if it could be adapted slightly. Maybe a related one would be for Tesla to buy a new battery factory / batteries or a massive amount of cobalt+lithium with equity. Those would all save them a ton of cash in the short term.
This theory makes sense to me. Changing a over-automated line to one that is safe to use by humans must be way more expensive and time consuming then just rebuilding the whole thing in the parking lot. I imagine this line will have a pretty hefty defect rate though.
It's not so much the tent that's the issue. It's more to do with the "fk it, we're in a bind, quick, everyone in the tent" approach which is raising eyebrows. Say what you want about Tesla, but they do make for interesting watching. I'll be grabbing my popcorn for this new episode in the story :)
The “tent” also likely has better quality air due to not using 40 year old air handling plant.
The mischaracterisiation of the new building as a tent is indicative of the lack of actual concerns about the new line, meaning the short propagandists have to invent new fears.
The existing line is functional, this is a new line to produce a new product (specifically the performance model 3).
I wouldn't want to work for him (I hear he's a nightmare), but he sure makes for a nice counterpoint to the rest of the daily news!
