tesla model 3 production
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Tesla Model 3 supplier’s orders tease steady 5k/week production in Q3

A recent note from JL Warren Capital LLC to its clients states that the research firm has found “encouraging signs” from a Tesla Model 3 supplier with regards to the production ramp of the mass market electric car.

According to the financial firm’s note, a Tesla Model 3 supplier is starting to see increased orders from the Elon Musk-led company. The supplier — Germany-based SAS Automotive — revealed that it had ordered 20,000 screens for the Model 3 in May, as well as an additional 10,000 displays in June from a producer in China.

As noted in a Bloomberg report, the Chinese producer is reportedly planning on manufacturing 58,000 Model 3 screens for Q3 2018. Spread out over the third quarter, this number translates to a production rate of just under 20,000 electric cars per month, or just below the company’s aim of manufacturing 5,000 vehicles per week. 

Tesla CEO Elon Musk has revealed that a steady production rate of 5,000 Model 3 per week will likely herald the introduction of the electric car’s next variants. Last April, Musk posted an update on Twitter stating that options such as the Model 3’s dual-motor all-wheel-drive version will probably be offered when the production of the electric car hits 5,000 vehicles per week. According to Musk, introducing options before the manufacturing milestone is achieved would likely cause complexities to the Model 3 line.

When asked about the timeline for the release of the Model 3’s dual-motor AWD configuration, Musk noted that Tesla would likely introduce the variant around July. Other options, such as the $35,000 short-range version and the highly-anticipated Performance variant with Ludicrous Mode are expected to be rolled out not long after.

The production ramp of the Model 3 has been a pain point for Tesla for the past few quarters, with the electric car maker missing its production targets so far. Nevertheless, despite falling short of its self-imposed goals, Tesla’s first quarter delivery and earnings report for 2018 suggest that the company is steadily approaching the production levels it is aiming for with regards to the Model 3. During Q1 2018 alone, Tesla managed to produce 9,766 Model 3 — a significant increase from the 2,425 Model 3 the company produced in Q4 2017.

This has not stopped the company’s critics, however. As of 4/9/2018, there were 38,258,654 shares held short in the company, essentially making Tesla the most shorted carmaker in the market by the amount of equity at stake. Musk has been directly challenging Tesla bears so far, however, predicting a “short burn” of the century on Twitter and buying almost $10 million worth of TSLA shares to increase his stake in the company.

Tesla Model 3 supplier’s orders tease steady 5k/week production in Q3
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