Elon Musk hails Tesla reaching goal of 5000 Model 3s a week

If all goes well, the scale of Model 3 production could make that possible, producing consistent profits that Musk can then plow into forthcoming projects like the Semi, the Model Y, and the new version of Tesla’s high-end Roadster sports car-thereby avoiding the huge cash flow swings of the last few years.

Tesla spiked as much as 6% in early trading Monday after the electric-car maker said it reached its goal of producing 5,000 Model 3 sedans in a week.

In context: Tesla still has a substantial backlog of Model 3 pre-orders to wade through and the company’s future is by no means guaranteed but it’s a step in the right direction nevertheless.

Deliveries in the second quarter totaled 40,740 vehicles – interpreted by industry observers as a little short of expectations – but not a major concern.

Tesla shares fell on Wall Street last night, closing down 2.3 per cent, or $7.88, at $335.07.

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Still, Tesla’s manufacturing pause is coming after a frenetic three months that involved building a makeshift production line under a tent outside its California assembly plant.

“Excessive automation at Tesla was a mistake”, Musk tweeted in April this year, acknowledging some of the company’s production line issues. The company has never posted a profit before and has been burning cash at worrying rates, with US$1 billion spent during the first quarter of this year alone.

Musk wrote to Tesla staffers that Tesla had achieved its goals.

Last summer, Musk set a production goal of 20,000 Model 3’s per week for the end of 2017 – and 500,000 for all of 2018.

If Tesla can produce a machine with genuine towing and payload abilities, reasonable daily range, and those workplace-oriented niceties, priced at $50,000 or less, the truck might have a shot. That total included 18,440 Model 3, 10,930 Model S, and 11,370 Model X vehicles. He even shipped an extra battery production line in from Germany, which Tesla put under a tent.

Model 3 production tripled to 28,578 in the company’s second quarter from the previous quarter, Tesla said.

“The last 12 months were some of the most hard in Tesla’s history, and we are incredibly proud of the whole Tesla team for achieving the 5,000 unit Model 3 production rate”.

If it still needs to be said, statements of Tesla’s expectations should be taken with a fairly hefty serving of salt.

With Tesla attaining a pace of 7,000 Model 3, Model S, and Model X per week, however, Ford would be wise to not underestimate the upstart electric auto maker.

The news is obviously good for Tesla, and especially welcomed by those on the ever-growing Model 3 waiting list.

But the CEO stressed that Model 3 assembly would not be impacted.