Electric cars and the impact on the environment

[Cobrar]

A friend of mine from the Mercedes Email List leased a Model S, P90D for almost three years. He had a number of problems with it, and his experience with Tesla as a car company and customer satisfaction says a lot about how long Tesla will continue to survive. I'm thinking about the end of this year Tesla will be in deep trouble, not only financially, but also for their reputation for customer service. If it looks like Tesla will have difficulty delivering cars, and fixing the ones already out there, people will be a lot more reluctant to plop down $100K or so when they have doubts whether their car will be "sustainable." And then the death spiral will follow. Anyway, we'll see soon enough. And we shouldn't yet count out Musk's ability to make more investors believe in his company and pump more money into it, or persuading one of the major car companies to take it over and try to make it into a real car company.

(reprinted with permission):

In one of their movies, Chico Marx had a great line that he said to Groucho
to the effect of: "Hey Boss, whatcha going to believe? What I tell you,
or what you see with your own two eyes?"

What I've related to this List is what I've personally lived through in
owning a Tesla for a couple of years, versus what Elon tells you. It
really boils down to the simple fact that they just don't know how to run a
car company. If you forget all the fluff, it's hard to ignore that:

-- their financials are a mess as they burn through incredible amounts of
cash every quarter

-- they lose money on every car they sell, and in a market where they have
no real competition (yet)

-- the falcon wing doors and other zoomy features of the Model X are cool,
but by Elon's own admission, they made the car too complicated

-- the buzz around how highly automated the Model 3 production line was
going to be had everyone in awe, but by Elon's recent admission, they made
it too complicated and it's now causing delays. They had to shut it down
last week for 4 or 5 days to make changes.

-- Elon's statement at the Model 3 highly promoted gala intro event in late
July that they'd be producing 5,000 cars a week by the end of December got
pushed back to end of Q1, and then again to the end of Q2

-- The replacement bumper cover took 8 weeks to arrive, and then it was the wrong part, and had to be reordered.

-- The replacement for the defective drivers seat for my car that was
ordered in the first week of January had yet to appear when I turned the
car in at the end of March, 3 months later. Whenever I inquired as to it's
status I was told it was "back ordered". My lease didn't end until the end
of September but I was approaching my 45,000 mile lease limit after which
I'd have to pay a 25 cent/mile penalty. And, the warranty ends at 50,000
miles and I did not want to own the car outside of warranty, albeit there's
a good chance that the replacement drivers seat may have shown up by then.

-- I tend to take care of all my cars, but there's nothing that I can do as the driver to cause the main battery to fail, wiring harnesses fail, door handles fail, etc., etc., etc. And all cars have failures, but MB would have solved those problems in a few days versus Tesla taking months to deliver the parts.

Facts are tricky things in that they are, well, they are facts. Hard to
spin them. Flame throwers, putting a roadster into space, boring a tunnel
etc., are all zoomy promotional events. Then there are the facts.

Reality check from Industry Consultant, Tesla is a work in progress:

http://on.forbes.com/6189Db4gl

 

[PeteK]

Thanks for the link. Learning curve vs. cash burn rate.

 

[djs]

WSJ today:
https://www.wsj.com/articles/tesla-continues-to-burn-through-cash-1525293204#comments_sector

 

[Kayvan]

2270/week, 4 weeks straight

https://www.bloomberg.com/news/arti...lt-slows-as-tesla-model-3-sales-pick-up-speed

 

[Sinovac]

https://www.bloomberg.com/news/arti...dumbfounding-moments-on-tesla-s-earnings-call

 

[dbk]

That was a uniquely disastrous earnings call. You know when you've lost Adam Jonas things are bad.

Visions of Jeff Skilling.

On the plus side, QC to get to those numbers is excellent. :lol

 

[Xcentric]

^^^ Was that built by a Monday morning robot or a Friday afternoon robot?

 

[dbk]

Don't worry, the manufacturing revolution has now been moved to the Model Y. (literally another bit from yesterday)

 

[AJB]

...that is what a 'rear quarter view' looks like when you combine "Performance White " on the sheet metal....with "Oxford White " on the fascia.
andy (ajb)

 

[Apollo]

Well, apparently the self proclaimed socialist is now making up stories about Ford to distract from his failings.

https://www.foxbusiness.com/features/ford-fires-back-after-teslas-elon-musk-calls-it-a-morgue

This article has a neat little bar on the top that shows how fast cash is being burned.

https://www.bloomberg.com/graphics/2018-tesla-burns-cash/

 

[Kayvan]

5000/wk.

So much for the naysayers.

 

[Apollo]

Meeting the goal kind of reminds me of the end of that Gung Ho movie.
I'm sure the faithful will look at this as a reson to funnel billions more into Tesla.

 

[PeteK]

This story is far from over. I still wish him well, but I ain't letting him use any of my money, either as an investment or deposit.

 

[Cobrar]

The short term “story” isn’t about the production level (5000 units). It’s about sustaining that level over time, producing the ‘promised’ lower cost/contented vehicles at an acceptable level of quality.

Oh, and doing that when the annual production levels exceed 200,000 units. At that point, (my recollection) the all important subsidy/tax credits to the buyer disappear. An interesting intersection point to find yourself in - ramping up production volume on a non-profitable vehicle while tax credits disappear. Stock offering/dilution imminent.

 

[Brombear]

A bit like watching football. So many experts at every TV set. Let’s see what’s next in this saga.

 

[dbk]

The short term “story” isn’t about the production level (5000 units). It’s about sustaining that level over time, producing the ‘promised’ lower cost/contented vehicles at an acceptable level of quality.

It's a big victory to hastily produce an assembly facility in a tent in the parking lot of your mangled factory to build $55k compact cars that could be considered salvage-title rebuild quality to meet this production level at the last possible second. At least the workers on the floor get 3 days of training before they are building these things.

Sure, it's insane, but organized religion often is.

 

[Cobrar]

Indeed. ~ And nice to see you back!

 

[dbk]

Scary stuff. Critical safety and QC checks being stopped in order to make numbers for the internet - no big deal. They had 300 welds on one surface that are now deemed unnecessary? How is that possible? Also, probably not a coincidence that the Chief Vehicle Engineer left the company permanently the same day the company hit the target. Nobody wants to go to jail.

Tesla CEO Elon Musk ordered his employees to stop putting nearly finished Model 3s through a critical test before leaving the company's factory in Fremont, California, according to an internal document viewed by Business Insider.

It's called the brake-and-roll test, and it ensures the car is correctly aligned.

An industry expert told Business Insider that every automaker does this test to ensure quality and function.

Tesla CEO Elon Musk appears to have asked engineers at Tesla's factory in Fremont, California, to remove a standard brake test, called the brake-and-roll test, from the tasks Model 3 cars must complete to move through production, according to internal documents seen by Business Insider.

The test was apparently shut down before 3 a.m. on June 26, according to a person familiar with the matter. It's unclear why this particular test was halted or for how long.

According to an industry expert, the brake-and-roll test is a critical part of the car manufacturing process, taking place during its final stages. The test ensures that the car's wheels are perfectly aligned and checks the brakes and their function by taking the vehicle's engine up to certain revolutions per minute and observing how they react on diagnostic machines.

In a statement, a Tesla representative, Dave Arnold, told Business Insider that every car goes through "rigorous quality checks," including brake tests.

When pressed on whether Musk himself gave the order to remove the brake-and-roll test, Arnold said, "I don't have anything further beyond the statement."

This is what the brake-and-roll test's step looks like in Tesla's internal production system.

brake and roll flowstepView photos
brake and roll flowstep
More
Business Insider

The far-left column shows what step the car has reached in the manufacturing process and what tasks must be done there.

The two key columns here are the ones labeled "critical" and "blocking." According to an employee at the company, they show it is apparently no longer necessary for the car to undergo this test before it leaves this step of the manufacturing process.

On the far right are all the descriptions of the tasks that should be performed at this station. However, since the criticality and blocking are off, the car can leave the station whether those tasks are performed or not, the employee said.

It's not clear how many cars, if any, have left the station without doing this test.

Quality issues

Ron Harbour, a consultant at Oliver Wyman who founded and writes "The Harbour Report," a worldwide guide to manufacturing, told Business Insider that after everything is installed in a car during the manufacturing process, a manufacturer would have to be very lucky for everything on a car to be in alignment.

"If you just abandon [the test], you could potentially have a lot of quality issues with your customers," he said. "Every plant does that ... It's part of finishing the build of the car."

Harbour told Business Insider he was unaware of any test that could adequately replace the brake-and-roll test on a manufacturing line.

By Alexandria Sage and Salvador Rodriguez

SAN FRANCISCO (Reuters) - Chief Executive Elon Musk barked at engineers on the Fremont, California assembly line. Tesla Inc tapped workers from other departments to keep pumping out the Model 3 electric sedans, disrupting production of the Model S and X lines. And weekend shifts were mandatory.

Tesla pulled out all the stops in the final week of June to meet its goal of making 5,000 Model 3s in a week, according to employees who spoke to Reuters. The sedan is essential to put money-losing Tesla on a path to profitability and prove that the electric car company can master mass production.

Whether Tesla can do it week in and week out - and without relying on overtime and extra hands - is another question, and one that weighed on investors.

Shares closed down 7.2 percent at $310.86 on Tuesday.

Leading up to Sunday morning's production milestone, Musk paced the Model 3 line, snapping at his engineers when the around-the-clock production slowed or stopped due to problems with robots, one worker said.

Tesla built a new line in just two weeks in a huge tent outside the main factory, an unprecedented move in an industry that takes years to plan out its assembly lines, and said the tented production area accounted for 20 percent of the Model 3s produced last week.

"They were borrowing people from our line all day to cover their (Model 3) breaks so the line would continue to move," said a Model S worker on Sunday.

"They've been throwing Model 3s ahead of the S to get painted to try to assure that they make their goal of 5,000," the worker said. "The paint department can't handle the volume."

Because of the focus on the Model 3, the S line was about 800 cars behind schedule to enter the paint shop, the worker said.

Any potential disruption of the Model S and X lines could threaten Tesla's target of building 100,000 of those vehicles in 2018. Tesla built 49,489 of those cars in the first half of this year.

Tesla said there had been no disruption to S and X productivity and noted it also built 1,913 of those vehicles during the last week of the quarter along with its Model 3s. A spokesperson also said workers from the S and X line had volunteered to help out on the 3 line.

Tesla built a total of 28,578 Model 3s in the second quarter, and 40,989 since production began last July, the company said.

Last week's big push also brought a rewrite of the employee attendance policy. After mandatory weekend shifts were assigned, two workers said, Tesla rescinded a policy promising workers at least one week's notice before weekend work.

"The manager and supervisor are verbally going around and saying: 'If you don't come in, you'll be written up'," one of the workers told Reuters last week.

Some employees are worried the frenetic pace plus long hours could burn out workers. One employee said they were told to keep working until they met their daily production mark, not when their shifts ended.

"They said starting tomorrow be prepared to work up to 12 hours," said the Model S employee on Monday. "It's going to be basically 12 hours from now on and I've got a feeling it's going to be six days a week."

To make its number, Tesla was willing to "spend any kind of money," a Gigafactory worker said, pointing to the new battery assembly-line flown in from Europe via cargo planes to the Gigafactory in May.

In the morning of Sunday, July 1, about five hours after the self-imposed second-quarter deadline had passed, the number 5,000 flashed on a countdown screen viewed by Tesla's Model 3 assembly-line workers. The Model 3 itself bore a "5,000" sign in its front window.

Tesla said on Monday that some of its Model 3 production would be on break as part of the July 4 holiday, with production to resume on Thursday. Tesla plans to build 6,000 Model 3s per week by August.

But the worker told to expect longer shifts warned that pushing assembly-line workers too hard could backfire.

"He (Musk) is going to go through an awful lot of people because people are going to start getting hurt left and right," by the fast-moving assembly line, the worker said.

"There's only so fast a person can move."

(Reporting by Alexandria Sage and Salvador Rodriguez; Editing by Greg Mitchell, Lisa Shumaker and Nick Zieminski)

 

[Cobrar]

Omitting 300 welds? Beyond scary, kind of begs the question, if this is public information, at what point does NHSTA have a fiduciary responsibility/obligation to perform testing on cars where this change has been implemented?

It's a big risk for the Tesla group, and if I were their head of vehicle technology, I'd resign on that note too. Although he will likely be back one day in Washington to testify. Ask the guy from VW.

 

[ByeEnzo]

Skipping steps in a production process never leads to quality and good long term outcomes. This holds true in my profession....It takes me a little over an hour on average to do a knee replacement. Guys brag that they can do one in 35 minutes and I wonder what essential steps and checks they are skipping.

And I own a 2013 Model S. I was an early adopter, but now I'm not real thrilled about the direction the company has taken.