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posted by martyb on Tuesday August 01 2017, @04:41AM   Printer-friendly
from the production-needs-a-boost dept.

Tesla is beginning to deliver a small number of Model 3 cars, but there are concerns that Tesla will not be able to produce enough cars to meet demand:

Wall Street finally got to see all the details of the Tesla Model 3 during the car's launch event Friday. So far investors have given it the thumbs down with the electric car maker's shares down more than 2 percent midday Monday.

"We believe the Model 3 was as good as or better than expected, and pricing was as expected with considerable initial upsell. That said, the rubber now hits the road, and the fundamental questions remain unanswered," Bernstein's Toni Sacconaghi wrote in a note to clients Monday. "CEO Elon Musk sounds increasingly squeamish about the production ramp." The analyst cited how the $35,000 Model 3 car will not be available until early 2018 with only a higher-priced $49,000 model available this year. He also noted Musk's comment to employees to prepare for "production hell."

Speaking of "production hell", Tesla employees in California are threatening to unionize:

Employees at the electric automaker's factory in Fremont, California, have been agitating for a union since Jose Moran, a production associate, wrote a Medium post in January detailing difficult work conditions at the flagship plant. The bulk of the demands has since centered on improving equipment to reduce workplace injuries.

[...] Musk originally called injury allegations at the Fremont plant "disingenuous or outright false" but has since told employees to report injuries directly to him.

Although the base price of the car is $35,000, that can rise to $55,000 or more after options.

Also at MarketWatch, Ars Technica, and CNET.


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  • (Score: 4, Interesting) by bradley13 on Tuesday August 01 2017, @07:43AM (5 children)

    by bradley13 (3053) on Tuesday August 01 2017, @07:43AM (#547551) Homepage Journal

    Just to add my two cents worth - nothing to do with specifications: I would never buy another car from any of the brands that produce in the heavily unionized rust belt. Two reasons.

    Personal experience: the cars are crap. I owned two, my mother never bought anything else. They often look nice, but reliability and quality are just not there. Unless things have changed in the last ten years or so, which I very much doubt.

    As to why: I have no chance of finding it, but I read an article 10-15 years ago that did a breakdown of the production costs for various brands of cars. For cars produced by GM & Co., the personnel costs were massively higher than for any other brand. Given that they price their cars competitively, the result is obvious: they use lower quality parts and materials.

    FWIW: I'm not saying that auto workers in the rust belt are overpaid. This has a lot more to do with union work rules, which force manufacturers to pay for a lot more union hours to accomplish any given task.

    Anecdote: I didn't work in the auto industry, but I did do a computer installation in that area. We had ordered the installation of wiring for sensors and valves ahead of time, in a unionized sewage plant (it stank, but not of sewage - the molasses plant across the road was...indescribable). For the installation, a co-worker and I needed to verify the wiring before hooking up the computer. One person at the computer end, one person wandering around the plant at the sensors and valves. Send a signal, check to see if it arrives, simple stuff.

    Obviously I did not know my way around the plant, so I needed a supervisor as a guide. Neither I nor the supervisor were allowed to touch anything, though. There was a union position for the guy who opened the junction boxes, but he wasn't allowed to touch the wiring. There was a union position for the guy who attached the meter to the wires, but he wasn't allowed to read the meter. There was a union position for the guy who read the meter. And union rules required us to be accompanied by an operator, another specific union position. So where two of us would have done, we were a troop of six. Four of those jobs did not need to exist.

    That's the kind of climate where the Chevy Bolt is produced. Those extra labor hours have to be compensated somewhere, and the most likely place is by buying cheaper materials. No thanks...

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  • (Score: 0) by Anonymous Coward on Tuesday August 01 2017, @08:55AM

    by Anonymous Coward on Tuesday August 01 2017, @08:55AM (#547565)

    That's the kind of climate where the Chevy Bolt is produced.

    Yeea.. naaahh! It's changing anyway... globally, rust belt included.
    I believe being warmer will be a plus for Detroit and Chicago, ain't so?

  • (Score: 0) by Anonymous Coward on Tuesday August 01 2017, @09:10AM (2 children)

    by Anonymous Coward on Tuesday August 01 2017, @09:10AM (#547567)

    > That's the kind of climate where the Chevy Bolt is produced.

    You forgot about the GM bankruptcy. Many things changed and one was the union rules, they are still around, but much weakened. Meanwhile, there are rumblings of a union at the Tesla plant.

    In both cases, car assembly is highly automated, with many fewer workers than you might remember from your time in the plant.

    • (Score: 0) by Anonymous Coward on Tuesday August 01 2017, @04:17PM (1 child)

      by Anonymous Coward on Tuesday August 01 2017, @04:17PM (#547688)

      obviously not automated enough with humans complaining about workplace injuries.

      • (Score: 2) by SanityCheck on Tuesday August 01 2017, @10:56PM

        by SanityCheck (5190) on Tuesday August 01 2017, @10:56PM (#547772)

        If they were a bit nicer to the robots then there might be a few less "accidents."

  • (Score: 4, Informative) by richtopia on Tuesday August 01 2017, @06:34PM

    by richtopia (3160) on Tuesday August 01 2017, @06:34PM (#547723) Homepage Journal

    I think most of your data is out of date. American automakers aren't perfect, but particularly during the automotive industry crisis in 2008 they re-evaluated a lot of their infrastructure. Many contracts were re-negotiated to reduce labor costs and improve competitiveness; for example the subcompact Chevy Sonic was able to be produced in Michigan largely because of cheaper labor (http://www.autonews.com/article/20110519/blog06/110519871/gms-chevy-sonic-plant:-more-than-cheap-labor).

    The big three have also realized that public perceptions on their quality are severely lacking, and have made huge strides to improve quality control. Specifically with the electric drive train of the Bolt it is probably one of the most researched electric drive trains on the market now. General Motors is betting big on the Bolt and I think the car has benefited for it.

    Your concerns are valid; American automakers had a poor track record for a long time. However I would not write them off completely today. They have heard complaints like yours and have spent the last decade dealing with their problems and make a product I trust. With that said, it is actually pretty difficult to find a poorly engineered vehicle for sale in the USA today, as all major manufacturers realize the importance of quality control.