Model 3 Assembly Line: Detailed Images of Tesla's "On the Fly" Manufacturing

The New York Times has an interesting set of images and comments on the Tesla Model 3 tent production line.

"On the Fly" Manufacturing

Scrambling to turn out its first mass-market electric car, the automaker set up multiple assembly lines and is changing production processes on the fly.

The New York Times asks Can Elon Musk and Tesla Reinvent the Way Cars Are Made?

The subtitles in bold below are mine and I reordered a few paragraphs.

Just two years ago, Mr. Musk envisioned 2018 as a breakthrough moment. Having established the brand’s cachet with high-end offerings — the Model S luxury sedan and the Model X sport-utility vehicle — Tesla would begin churning out more affordable Model 3 sedans. With a high-speed, high-tech assembly process, the company’s sales would soar more than fivefold, to half a million vehicles.

It hasn’t turned out that way. Tesla had trouble mass-producing both battery packs and cars. By the end of nearly three months of production after Tesla started assembling the Model 3 last summer, just 260 had rolled off the line, and Mr. Musk said the company faced a prolonged period of “manufacturing hell.” He had hoped to produce 20,000 Model 3s a month by December, but a mere 2,425 were completed in the final three months of 2017.

What the heck is this guy doing with what looks like an iron?

Established car companies master the process with assembly-line workers, and then find ways for machines to take over some of the work. Tesla did the opposite. It designed a highly automated production line populated by more than a thousand robots and other assembly machines.

In a very tangible sense, Tesla views its production line as a laboratory for untested techniques. In recent weeks, company executives concluded they could produce Model 3 underbodies with fewer spot welds than they had been using. The car is still held together by about 5,000 welds, but engineers concluded that some 300 were unnecessary and reprogrammed robots to assemble the steel underbody without them.

300 welds deemed unnecessary on the fly. No possible problem there.

“It’s unusual to be doing that at this point in time when the car is already launched,” said Mr. Harbour, a veteran manufacturing expert who has visited most of the world’s major auto plants. “Normally you’d make changes like that in the prototype stage.”

“The first step in auto quality is stability,” Mr. Harbour said. “Once you get a stable process that works, you can go back and make improvements.”

Tesla, by contrast, is tinkering with its production lines on the fly, and the tent is a stark illustration of that approach.

And a third assembly line, outside the walls of a plant? “I’ve never heard anything like this, ever,” Mr. Harbour said.

No Possible Problems Here Either

In another bid to push the limits of technology, Tesla at times pulls robots off the line and tests them operating at speeds greater than specified by the supplier, said Charles Mwangi, Tesla’s director of body engineering.

Quality Workers, Fully Trained, Not

Untrained Workers - What Can possibly Go Wrong?

Mr. Harbour, the manufacturing expert, says automakers typically give new workers several weeks of training before putting them into production work. Bringing in large numbers of new workers can hurt quality because they may not perform their work properly or fail to notice when problems crop up.

New workers at the Fremont plant get three days of training before going to work on a production line. This includes a day of computerized virtual training on doing their jobs safely, and a day of instruction on the area to which they will be assigned.

How About a Broken Jaw?

Worker safety at the Fremont plant has come under scrutiny after a nonprofit news organization, the Center for Investigative Reporting, cataloged a series of injuries suffered by Tesla factory workers. California’s job safety watchdog is investigating a recent incident that left a worker hospitalized with a broken jaw.

Costs Mounting

Tesla has already spent heavily on the Model 3 assembly process, and modifications mean machinery purchased for hundreds of millions of dollars is likely to be discarded.

Max Warburton, an analyst at Sanford C. Bernstein, estimates that Tesla spent about $2 billion to set up the Model 3 production line. “This is vastly more than we’ve seen any other car company spend on new capacity,” he said, adding, “$2 billion is a mind-blowing amount to spend on a second assembly line at an existing plant.”

Story Stocks

I have no position in Tesla. Shorting story stocks requires perfect timing.

Bonds Deep in Junk Territory

On March 27, Moody's Downgraded Tesla Debt to B3, fearing liquidity pressure.

The divergence between Tesla's bonds, trading deep in Moody's junk territory, and the equity price is startling.

Believe the bonds.

Delivery Promise

Tesla promised to deliver 5,000 cars per week by the end of June.

Watch the stock reaction, especially if the goal is reached. Tesla can easily plunge badly on supposedly "excellent" news.

Expect an announcement soon.

Mike "Mish" Shedlock

Comments (26)
No. 1-26
tz1
tz1

Remember the video where the battery coudl drop and be replaced faster than pumping a few gallons of gasoline?

Does that battery swap thingy exist ANYWHERE in the USA or do the EVs have to sit there for at least a half hour?

caradoc-again
caradoc-again

The battery drop idea was out of Israel and went down the pan. Somehow I think the demise of Tesla will be associated with this bull market top and roll-over. It will go down in the history books as indicative of this period.

Better Place -

caradoc-again
caradoc-again

Enough said.

"Better Place filed for bankruptcy in Israel in May 2013. The company's financial difficulties were caused by mismanagement, wasteful efforts to establish toeholds and run pilots in too many countries, the high investment required to develop the charging and swapping infrastructure, and a market penetration far lower than originally predicted by Shai Agassi. Less than 1,000 Fluence Z.E. cars were deployed in Israel and around 400 units in Denmark, after spending about US$850 million in private capital. After two failed post-bankruptcy acquisition attempts, the bankruptcy receivers sold off the remaining assets in November 2013 to Grngy for only $450,000."

SMF
SMF

If Tesla wasn't a darling of the political establishment it would have disappeared long ago into bankruptcy.

glider
glider

Sorry Mish, love your site, but your Tesla bashing articles generally are a bunch of sensationalistic click bait (one does not need to be short to profit from these negative articles). How do you justify cryptically criticizing Tesla for reducing weld points by 6% and tossing in a gratuitous "what could go wrong here?". Are you suggesting that other car manufacturers never make such changes? And do you have engineering insights that say that this is a negative (stiffer better) rather than a positive (more flex better), or at least a neutral cost savings decision? And please provide original source for this information? Was this from a trove of possible short seller inspired/paid off spy worker(s)? and wouldn't that be relevant?

CautiousObserver
CautiousObserver

The Tesla story reminds me of Eclipse Aviation. Many wanted to believe that Eclipse would succeed right up to the end. I realize an electric car is much simpler than a jet aircraft but I still think there are many parallels:

Carl_R
Carl_R

Re: “Normally you’d make changes like that in the prototype stage.” It seems to me that Tesla is still in an extended prototype mode. They want to be in final production, but really aren't there yet.

glider
glider

Carl, Tesla does things differently and makes positive changes midstream. Other manufacturers knowingly keep producing known problems and wait to fix at next model year so they can advertise it as "new and improved". If you don't like that philosophy there are plenty of ICE and Hybrids around to fit your desire.

glider
glider

SMF, obviously Detroit, bailed out multiple times by "our" government, is held in contempt by our corrupt Congress and POTUS. Only hope u r selling what your smokin!

Brian1
Brian1

This looks exactly like the Delorean story before they crashed. Rushing cars out of production to meet numbers while the founder had to sell cocaine to meet payroll. Those end-time Deloreans were pieces of junk too.

Tesla is going to be hammered with warranty claims if they don't go out of business first. These Model 3's are going to have zero resale value on the used market after 5 years. Replacing the battery will cost more than the car is worth.

Six000mileyear
Six000mileyear

As an engineer in FDA and MIL/DoD regulated environments, I rarely saw on-the-fly changes during the manufacturing process. There were many changes made in the prototype stage that fixed problems. Every time I've personally seen a company abandon tried and true engineering or manufacturing processes (ISO 9000), the project ended in a functional failure and/or huge financial losses. At this point I expect no different outcome from TESLA.

glider
glider

Brian1, better short more then! Remember Deloreans were underfunded and just gave consumers a sexy body with gull wing doors but had total crap performance.

From Wikepidea: DeLorean needed (more) power when.. magazine.. tests showed 0–60 mph.. times (of) 9.5 and 10.5 sec, while rivals (did) 7.5–8.5 sec.

By the time they got a proper motor designed they were bankrupt and so they failed. Current shorts are hoping an American made car, revolutionizing the industry by making electric motors a better alternative to ICE motors, fails. Great crew that is. I and other longs wish them ill as they do us and the planet, for the sake of their affinity for threatened established ICE companies. But this is called capitalism and a free market. And I expect to see the best system win.

glider
glider

Well since Tesla is apparently has the highest percentage of short shares on the exchanges and is taking on an established well connected industry, just maybe there is something there? But no worries, wrong shorts are a positive at end of day. Musk has been a cheerleader of sorts. That is good for motivating workers. I would ask why the short cult and others seem incapable of understanding him and insist on nitpicking his long term successful endeavor on a Q to Q basis. Other than that I believe Elon has gotten the message to taper off his public comments (from certain investors) so as to not incite short emotions. I kind of disapprove of all that but so be it.

Stuki
Stuki

A mass produced car, needing to meet the expectations of buyers of $50K cars today, is an orders of magnitude harder and more more complex undertaking than a general aviation plane. GA aircraft can get away with essentially being a series of one-off prototypes. Kind of like early Teslas. Their buyers are conditioned to maintenance and inspection regimes that hasn't been acceptable to the auto industry since the model T.

But your comparison is still valid. Both companies flew high uncritically hawking "new-new" to the kind of people who have money in economies where wealth is redistributed according to clueless gullibility, by way of the printing press. It's the progressive "theeengz aaare diiiferent noooow" mantra taken to it's logical conclusion.

More onerous than these two freak shows in isolation, are that they are only the very tip of what is, by now, a largely all encompassing iceberg. Teslas and Eclipses are all "the economy" has been busy "producing" and "creating" since Nixon went full retard.

Stuki
Stuki

There is nothing revolutionary about an electric motor.........

What's holding BEVs back, has nothing to do with the engines. It has to do with the energy density, in terms of weight, space and cost, of the fuel storage.

There is a reasonably sized niche market whose use for a car, allows them to work around that. They're happy to drive at Corolla speeds for a few miles a day, and pay $100K for the privilege. As long as their equipage is more "special" along some metric than a Corolla, and hence "says something" they consider positive about them.

But it's unlikely to be a very large, nor stable market. Evolution has a way of, over time, favoring the pragmatic.

CautiousObserver
CautiousObserver

Stuki, I was referring to the complexity of the vehicle and not the complexity of a mass production line or meeting a certain price point. Obviously, manufacturing either GA aircraft or automobiles presents unique and formidable challenges. I will leave it at that.

If there is one thing I find striking about Eclipse and Tesla, it is how far a veteran tech CEO can go into the abyss before the general public will begin to question lack of success in manufacturing the promised physical product.

Mike33
Mike33

Mish's tesla articles have the bias of a short seller (most of whom are losers that have gotten trounced in the market and are hoping for a crash to make them whole). Have you ever test driven a model s mish? The car is amazing. Autopilot is fantastic for bumper to bumper traffic and the car can accelerate/brake much quicker than a typical luxury sports car. Maybe the stock is overvalued or not, but $50 billion companies with superior products find ways to not suddenly go into bankruptcy. The irony is mish is so pro-autonomous car. Instead of being pro-Tesla, he'll bash them for the couple outlier crashes they've had like mainstream media.

Stuki
Stuki

The General Public do as they are told and conditioned to by those they consider "successful." Which, in the age of financialization, means those who are being handed the most money by the Fed. And those guys are correlated, at best, not at all; with those who have a clue about anything, and have even the basic aptitude required to think critically about a proposition.

Over 95% of all money/credit/wealth currently around, has simply been printed out of thin air since Nixon's retard moment. Then handed to those who currently own it, not on the basis of the quality of anything they have done, or any unique insight any of them (didn't) have. But simply randomly, with a skew towards those most willing to make themselves the most dependent on "the system." Along with a much stronger skew towards those most connected politically, legally and financially and socially. The random part being necessary to fool the uncritical masses into accepting this as some sort of just or inevitable; rather than recognizing it for the the crass wealth redistribution/theft it really is.

As a side effect, those who have money to invest, have nothing in common with those who have a clue about what to invest in. And are hence the ones who never saw a Brooklyn Bridge that wasn't a "great investment." No financialized society will ever turn out any differently.

In free societies, wealth, hence resources and influence, flow towards those who have proven competence. By creating something of value that others are willing to pay for. But wealth distribution according to competence, is way to anarchic and unpredictable for those who fancy themselves the "elite." So, if the latter is to retain their privilege; a different way has to be found. Financialization was that different way. It has worked out fine for the privileged since it was initiated.

BUT, by not distributing resources and influence according to competence but instead to a gaggle of incompetents; you inevitably end up with resources being utilized incompetently. Weakening society more and more, until it gets sacked by less cluelessly organized outsiders.

justsomeguy
justsomeguy

@glider - regarding the change in welding mid production vs waiting for a new model year, things like this are creating a lot of problems for owners in the future. If tesla continually changes aspects of the car, there's extra complexity for your mechanic or auto body.

Let's say the fewer welds are a better design that provide more durability and stability. Then how does that impact the resale market for Teslas? If I'm buying a used model 3 I'm going to have find out the production date of the car so that I can look up and see what improvements the vehicle has and doesn't have. How do I compare it to other model 3 on the market that were built at different times to figure out if it's a fair price or not.

These are the reasons why other car manufacturers leave the design static for a year. A 2017 VW Jetta sold in the USA is going to be the same as all the other 2017 VW Jettas in the USA so I know what I'm buying and my mechanic knows how to service it. With Tesla I get none of that. Sure they're doing things differently - working more as a tech company than a car company - some of these things are very good, but some are not so good.

Wagner_4
Wagner_4

We just have to wait until Mark B Spiegel's Stanphyl Capital goes bankrupt. Then Mish will be again back on the right track and will most likely stop retweeting that Mark's TSLA bankwuptcy crap, because Mark won't have any incentive to post his conspiracy theories about Tesla on Twitter.

By the way there was a secret source for Mish that warned about Boeing ~2 years ago (you can google Mish's article here). Boeing 737MAX did incredibly well and now the BA stock price is up big time.

glider
glider

I highly doubt the public will be paying the attention to the nuances of spot welds the the Tesla short cult does! Regarding possible valuation effects complicating used car purchases the auto industry has always lived with that to its advantage. They want you to buy the new car not the old car. Much ado about nothing.

glider
glider

Yes I am a Tesla fan boy, and I tend to look on the positive side rather than looking to tear things down for profit. That is me.

You point to "300 welds deemed unnecessary on the fly" as not being cryptic and be based on fact. Well, "on the fly", to most readers suggests something that was done on a whim, rather than through sound engineering assessment. So where is that data? If criticism is based on fact where is the data showing an absence of it being a solid engineering based decision and something that never happens in the auto industry? Without that it is innuendo and factless desperate scaremongering.