Elon Musk Mistakes Self-Interest For Smart China Policy

Elon Musk is truly a mixed blessing for anyone seeking to broaden the public’s understanding of the auto industry. On the one hand, he has single-handedly inspired more public interest in the business of making and selling cars than anyone in the last thirty years. On the other hand, he so often arms these newcomers with a profoundly warped perception of this important but widely-misunderstood industry.
Take the Tesla CEO’s recent tweet-storm directed at president Donald J. Trump: though well-calibrated to provoke a response from the belligerent Commander-in-Chief, Musk’s complaints are more personal grievance than big-picture analysis. In agitating against China’s long-established rules for access to the largest car market in the world, Musk is zeroed in on problems that frustrate his ambitions but that hardly trouble the industry’s largest players. And by attempting to provoke Trump to tackle China’s auto industry rules, he risks setting off a trade war that could be devastating to the entire sector.

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Tesla’s EDR About-Face Raises More Questions

After insisting in no uncertain terms that its vehicle data recording systems are not “Event Data Recorders” (EDRs), Tesla seems to have had a change of heart. Bozi Tatarevic, who broke the first story about Tesla’s evasion of EDR regulation back in 2016, followed up today with a report pointing out that Tesla has created a new section of its website with information about what it now calls its EDR systems. As a result of this change, Tesla has made a third-party vehicle data-reading hardware tool, as well as its own retrieval software, available to the public. Daily Kanban congratulates Bozi for his continued leadership on this story, but we do feel called to lay out some context that didn’t make it into his write-up.

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Searching For “Production Hell” At Ford’s Kentucky Truck Plant

As Tesla has blown through one Model 3 production volume deadline after another, the automotive upstart’s “production hell” has become a topic of intense scrutiny and debate. Among fans of the company, the overwhelming majority of whom have little to no exposure to automotive manufacturing, the belief that Tesla must be innovating bold new manufacturing techniques that will leave the “legacy” automakers in the dust has become an article of faith. But if you spend some time at one of the established auto manufacturing plants that currently pumps out products and profits that Tesla can only dream of, it quickly becomes clear that the Silicon Valley startup culture that fuels Tesla’s innovative design and blistering performance is more liability than asset when it comes to the difficult task of actually making cars.

A recent visit to Ford’s Kentucky Truck Plant (KTP) put the contrast between Tesla’s approach to automaking and that of the established automakers into sharp relief. Even before I set foot in the massive facility, it became clear how much more confident Ford is in its manufacturing operation than Tesla. Whereas Tesla typically only opens its Fremont factory to Tesla owners who are required to sign nondisclosure agreements, Ford’s tour took select news media through nearly every portion of the plant (including the paint shop, which almost every factory limits access too), encouraged us to speak to any worker we liked, and asked only that we keep news of a new $25 million investment embargoed for a few days. If Ford were experiencing the “production hell” that has characterized every new Tesla product ramp we would have had no problem recognizing it.

What we saw instead was the intricate ballet of modern automotive manufacturing, a complex yet precise operation involving thousands of workers, robots and suppliers. We saw the fascinating mix of humility and pride among the workers who make up the foundation of the production system, the tight choreography of a fully automated body shop that turns sheets of aluminum into vehicle bodies, the firehose of data that keeps the entire system working together and the latest 3D printing technology that Ford has brought in to continuously improve –rather than replace– the humans and robots that move tirelessly to the beat of an unseen drummer. And at the end of the line, we saw that beat made manifest in a new Ford SuperDuty pickup, Expedition, or Lincoln Navigator rolling off the line at a steady rate of more than one per minute.

In short, nothing about KTP suggested anything that might be described as “production hell,” even as it produced more vehicles every day than Tesla makes Model 3 in a week. And though it may not have looked like an illustration from a speculative SciFi novel about the factories of the deep future, KTP also gave no indication of being a laggard in production or quality that might be disrupted by Tesla or anyone else.

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Source: Tesla Responsible For Model 3 “Production Hell”

Tesla has been vague about its reasons for missing its first full-quarter Model 3 production goals by more than 80%, blaming “bottlenecks” for the delay and “emphasizing” that “there are no fundamental issues with the Model 3 production or supply chain.” But according to a source familiar with the development and deployment of the Model 3 production system, Tesla’s rushed and disorganized approach made the current “production hell” inevitable.

At the outset of the Model 3 program, Tesla asked a major automated tooling supplier to develop two Body In White (BIW) transfer lines for the Model 3. The source, who spoke on condition of anonymity for both himself and the supplier, says disagreements between Tesla’s designers and engineers resulted in numerous revisions to the scope of the contract and eventually led Tesla to drop the second line from its purchase order (PO).

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Did Tesla Stealthily Disclose Model 3 Ramp Issues?

The 5 Lakes bots

Controversy has haunted Tesla at every step of its extraordinary journey, making it hands-down the most argued-over automaker in the world. These controversies have touched on nearly every aspect of the California-based car company’s business, but they also share one core commonality: at their core, every Tesla controversy has been about disclosure.

Countless issues that might have been easily forgivable if disclosed early and fully have escalated into major controversies because of how the company communicates (or doesn’t) about the challenges they face. Never has this been more true than it is in the case of the most recent controversy about Model 3 production, which was kicked off last week by a Daily Kanban report. [Continue Reading]

Source: Tesla’s “Pilot” Model 3 Body Line Still In Development Near Detroit

Photos, apparently of a Model 3 “pilot team” in “Area 51,” were subsequently deleted by a now-private Instagram account.

Three months ago Tesla CEO Elon Musk tweeted that production of the new Model 3 in “Aug[ust] should be 100 cars and Sept[ember] above 1500.” But over the following quarter Tesla ended up delivering only 220 of its new more-affordable electric cars, or just 15% of Musk’s guidance. Though Tesla’s delivery press release didn’t identify the cause for this dramatic miss, it did state that

“It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain. We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near-term.”

What does and does not constitute a “fundamental issue” with the Model 3 production ramp is open to debate, but a source tells Daily Kanban that elements of the Model 3 body line are still in development at the Michigan-based supplier Thai Summit America and not yet installed at Tesla’s Fremont facility.

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Tesla: Production Capacity Of Model 3 To Average 226,563 Units Per Year Over Next Five Years

George Orwell famously wrote that “to see what is front of ones nose takes a constant struggle,” and it turns out that the answer to one of the biggest mysteries in the auto industry has been hanging out directly in front of the public’s nose for some time. In a January 2017 application [PDF] for sales tax exemption (STE) from the CAEATFA program, the California Treasurer revealed that

“Tesla represents the Project will launch the Model 3 and provide the capacity to produce and deliver an average of 226,563 units per year over a five year period, in addition to its Model S and Model X production.”

This revelation provides an unprecedented clarity about Tesla’s production ambitions for its “more-affordable” Model 3 sedan, and contradicts representations that Tesla executives have made in quarterly conference calls with analysts and the media.

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Waymo Retires Iconic “Firefly” Vehicles

Google’s self-driving car company Waymo is retiring its iconic “Firefly” self-driving vehicles from testing fleets after three years in service. The Firefly, which were widely known as “the koala cars,” are being replaced by Waymo’s expanding fleet of Chrysler Pacifica plug-in hybrid autonomous minivans. This transition comes as Waymo moves toward commercial availability, including an “early rider program” in Phoenix, Arizona.

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