Documents Show Tesla Expanding Annual Production To About Half Of 500K Goal

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The Daily Kanban has obtained Tesla’s application [PDF here] to the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) for about $100m worth of Sales and Use Tax Exclusion (STE) on its purchase of about $1.2 billion worth of production equipment to be used to produce its affordable Model 3. An analysis of key unredacted portions of this CAEATFA application shows that this massive investment –along with CAEATFA documents related to Tesla’s expansion of Model S and Model X vehicle production— will only increase the electric automaker’s annual production to between 230,000 and 300,000 units per year, well short of the firm’s 500,000 unit per year goal for 2018.

Though Tesla could reach its much-discussed half-million per year production goal through other means, these CAEATFA documents appear to validate Daily Kanban‘s analysis of air quality permits at Tesla’s Fremont plant which indicates a current production limit of about 230,000 units per year.  Tesla has yet to publicize any plans to apply for the new permits or make the new investments required to bring its production rate beyond these limits and towards its planned 2018 rate of 500,000 units per year.

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Chrysler Is Still Waiting For Its Quality Turnaround

Who's laughing now?

Who’s laughing now?

In 2009, when Sergio Marchionne’s team presented the first five-year plan for what would become Fiat Chrysler Automobiles (FCA), his VP for Quality Doug Betts told attendees that Chrysler’s quality problems would soon be a thing of the past. Thanks to Fiat’s superior fit-and-finish standards and “World Class Manufacturing” system, Chrysler hoped to match the best mass-market competitors on quality by 2012 according to Betts. Three years after that initial goal had passed unaccomplished, Betts is gone but FCA’s US-market brands are still occupying the bottom tier of Consumer Reports’ most recent automotive quality survey. With quality problems plaguing even its “halo” Hellcat and Ecodiesel engines as recently as last week, it’s clear that Marchionne hasn’t been able to bring the long-term quality backmarker up to pace.

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Mazda’s Secret Weapon: The CNC Motor Factory

Everybody route now!

Everybody route now!

 

Of all global automakers, Mazda may be in the toughest position. As if it weren’t hard enough to be one of the smallest independent mainstream automakers left, it faces the thankless task of marketing an enthusiast-oriented brand as well. And without the support of a major partner now that Ford has departed its alliance with the Hiroshima-based automaker, Mazda is hustling to stay in the game. But the hottest fires produce the hardest metals, to borrow a phrase used more by marketing types than engineers, and Mazda’s fight for existence is producing some interesting innovations. As Dave Coleman, vehicle development engineer at Mazda’s North American Operations tells Wards Auto:

“We needed to approach that fundamental truth (of economies of scale) and find out if it’s still fundamentally true, or is there a way to engineer our way around it. And it turns out there is a way to engineer around it.”

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