CEO Elon Musk sent an e-mail to company employees Sunday praising them for producing 5,000 Model 3s, a compact auto that's created to shift Tesla from a niche manufacturer to a mainstream automaker. But that's not all. Tesla CEO Elon Musk tweeted later that day the company had produced 7,000 vehicles in a week, a figure that includes Model S and X vehicles as well.
With the 5,000/week threshold now in the books, and with Tesla now claiming that a production rate of 6,000 Model 3 units per week will be hit later this month, Tesla investors certainly have much to cheer about.
News that Tesla had hit the 5,000-per-week target came out Sunday as the last Model 3 rolled off the assembly line and employees celebrated.
But the company still only managed to crank out an average of 2,198 per week for the quarter.
Tesla has built 5000 Model 3s in a week - thanks in part to a hastily-erected tent in the brand's Fremont factory parking lots - marking the completion of an Elon Musk promise.
Overall, reaching the 5,000-cars-per-week milestone dominated the mostly-positive production report for the company, with actual deliveries of the Model 3 falling short of predicted levels being one of the only sour points. After mandatory weekend shifts were assigned, two workers said, Tesla rescinded a policy promising workers at least one week's notice before weekend work. Despite hitting that production number, Tesla missed the consensus forecast for Model 3 deliveries in the quarter as a whole by nearly 12,000, or 39 percent (this may also reflect a strategic move to limit deliveries in order to extend federal subsidies).
The Model 3, which starts at USA $35,000, is the key to turning Tesla from a niche maker of expensive electric cars to a profitable, mass-market automaker. "Though the production hiccups have led to tumultuous periods for the shares, they're now up 10% this year, and the company is valued at $58.2 billion".
Analyst Brian Johnson of Barclays warned investors in March to be wary of brief "burst rates" of Model 3 production that were not sustainable. Going conservative on the Model 3's 0-60mph time would help reinforce the appeal of the Tesla's more-premium Model S. The slowest Model S can hit 60mph in just 4.2 seconds, and the slower the significantly cheaper Model 3 is from that time, the better - for Tesla, anyway.
The Tesla (which we codenamed "Model U" in our renderings) will also have a load-adjusting suspension, according to Musk. But for years, the key question for Tesla was could it deliver consumers a more affordable EV for the masses. 'The Model 3 fits five adults comfortably, ' said Musk. He reiterated a Sell rating and $195 price target on the shares today, writing that while the company did make its production goal, as he expected, Model 3 deliveries missed his bearish estimates.