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Tesla Model 3 Production Delayed And No One Should Be Surprised

"Elon Musk needs to stop over promising and under delivering."

Tesla is no stranger to production delays, and its all-new Model 3 isn’t immune. Bloomberg reports that Tesla CEO Elon Musk had admitted in a conference call with analysts that the 5,000 units per week goal won’t begin until sometime next March, three months behind schedule. “I have to tell you I was really depressed about three or four weeks ago,” Musk said to those industry analysts. “In the grand scheme of things this is a relatively small shift.” Here’s the problem with that statement: investors don’t like what they’re hearing.
The proof is that Tesla shares were down 6.6 percent last Thursday, the biggest drop since last July. Basically, Tesla is still in “production hell,” as Musk himself once put it. Building an affordable mainstream vehicle is proving to be much different and, not to mention, far more difficult than luxury vehicles like the Model S and Model X. More than 400,000 anxious customers placed deposits for the $35k base price Model 3, and now they’re going to have to wait even longer than originally told. “We left the call frustrated with the lack of transparency from Tesla management,” stated one analyst who now recommends selling Tesla shares.
“Elon Musk needs to stop over promising and under delivering and the board should rein in a CEO who publicly shares his aspirational goals that have rarely been hit.” In just the third quarter of this year, Tesla burned through $1.42 billion in cash due to investing in both its assembly line and battery Gigafactory. The bottom line is that Tesla could quickly be approaching a make or break point. Serious investors and shareholders – not devoted buyers/followers – are running out of patience.

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