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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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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Detroit Auto Show: Signs Of Trouble Ahead

Buckle up!

Buckle up!

Interpreting what an auto show has to say about the state of the car industry isn’t always easy. Though there’s enough groupthink in the industry to regularly produce obvious trends (current example, “Shooting Brake” three-door sportscar hatchbacks), these are mostly just the superficial fluctuations of any fashion-oriented business. Looking deeper, however, connecting a show’s trends with the broader market context, is often quite difficult. Not so for this year’s Detroit Auto Show, however. Simply scanning through the new debuts, the lack of mass-market or utilitarian offerings was immediately noticeable. More to the point, the glut of luxury products was inescapable. [Continue Reading]

Detroit’s Japan bashing has one aim: To protect obscene pick-up profits at home.

With a steering wheel on the wrong side, would this car stand a chance in America? The wheel is on the wrong side in Japan.

With a steering wheel on the wrong side, would this car stand a chance in America? The wheel is on the wrong side in Japan.

For many years, Detroit has blamed Japan for Detroit’s insipid sales in the island nation. Detroit, and its mouth pieces in Washington, claim this is because the Japanese market is closed. A look on the customs charts and into sales statistics would unmask this as blatant lies. In an overall flat Japanese auto market, sales of Imports rose 9.5 percent in 2013. Japan’s tariff on cars is zero. But then, who reads sales statistics and customs charts? Hopefully, more people read Reuters.
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Ten Burning Questions For The Detroit Auto Show

No Daily Kanban staff were required to set foot in Detroit's Cobo Center during the making of this report.

No Daily Kanban staff were required to set foot in Detroit’s Cobo Center during the making of this report.

10: Has it become any better to cover? Are the WiFi hotspots still overloaded? Does your phone still switch to an international roaming plan if you stand in the wrong corner of Cobo? Has the free everything been great? Is the weather halfway decent? Just kidding, everyone knows the answer to those questions. And since each of these ten “questions” is really more of a series of questions, let’s just get on with it, shall we?

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While Detroit pouts, EU carmakers are about to grab a very big small car share in Japan

Japanese Mustang owners - Picture courtesy

The EU and the U.S. are both negotiating a trade pact with Japan. It could light a fire under international commerce while putting China in a box. Detroit wants it to fail. The style of the negotiations can’t be more different. In the U.S., the Detroit 3 regurgitate trite and untrue rhetoric. Meanwhile in Europe, shrewd dealmakers could alter Japan’s automotive landscape. [Continue Reading]

Romney’s Plan Would Also Have ‘Saved’ Detroit (SWWE)

Mitt Romney - Pictufre courtesy

Of all the issues broached in the presidential campaign, the auto-industry rescue of 2008-09 stands out as an example of the triumph of spin over facts.

Keying off the New York Times’s headline for Mitt Romney’s 2008 op-ed, “Let Detroit Go Bankrupt,” President Obama has argued that the only alternative to his “bold” rescue of General Motors and Chrysler would have been a disorderly liquidation of the entire U.S. auto industry. Yet a close reading of Mr. Romney’s op-ed reveals that his proposal was actually quite similar to the course of action the president took, right down to government funding of the bankruptcy reorganization process and warranty backstops. [Continue Reading]