Tesla made a huge splash, recently, when it “launched” the new Model 3 sedan. The Tesla Model 3 is supposed to be the brand’s first mass-market car, an electric car for the Average Joe, not just the wealthy. A few months ago, Tesla supposedly began the first deliveries of the Model 3, creating a ton of media buzz and customer excitement. However, that excitement has since waned as reports of the Model 3 going through “manufacturing hell” have surfaced.
While the first “deliveries” of the Model 3 sparked excitement, a rise in stock prices and increased investor interest, it’s starting to look like that was a bit of a ruse for those exact reasons. See, the first deliveries consisted of 30 Tesla employee customers getting their cars that they pre-ordered. It’s now been rumored that those cars were hand-assembled, just to get them built and delivered for this public so-called model launch.
Since then, there have been quite a few manufacturing setbacks for the Model 3, enough to worry both customers and investors alike. The Wall Street Journal reported that these manufacturing setbacks were requiring much of the Model 3 to be assembled by hand, which would delay deadlines considerably. Tesla owner Elon Musk has since denied that report, tweeting out a video of the Model 3 assembly line working at 1/10th speed.
Still, Model 3 production is far behind schedule, there are rumors of welding issues, supply chain issues and that’s on top of the fact that every other Tesla model has already been significantly delayed. Add the brand’s quality control issues and there’s good reason for investors and customers to be a bit worried. We wouldn’t be surprised if a lot of customers ask for their $1,000 deposits refunded.
To be honest, unless customers really, really want a new car soon and can’t be without their $1,000, they shouldn’t get a refund. It should be expected that Tesla will be delayed and that the Model 3 will not only come later than hoped but will have a few quality control issues. It’s not necessarily Tesla’s incompetence but its lack of manufacturing experience and capability.
Tesla is a very small, very young company. So it’s always going to have difficulties keeping up with the larger, more mainstream manufacturers, in terms of actual production. Companies like BMW can far more easily mass produce electric cars. It already has far better manufacturing know-how and supply chain access.
Another problem with the Model 3’s production and manufacturing delays is with its target audience. The Model 3 is designed to be the electric car for the masses, not the wealthy. The average car buyer doesn’t have the ability to put money down on a car as a deposit and not get the car for years. They also don’t have the ability to deal with quality issues with their car once they get it. Cars like the Chevy Bolt or new Nissan Leaf might be better suited to many customers, as both are far cheaper (after options) than the Model 3 and neither are going to have any of the issues Tesla is having.
If you can wait it out, it’s probably worth it. The Model 3 will be a very exciting car when it does debut, as it offers an inexpensive, premium full electric car to the masses. However, it’s worth keeping an eye on the manufacturing and quality control issues that are circulating Tesla’s newest car.