Tesla makes last ditch Model 3 delivery push as pressures mount
SAN FRANCISCO: With pressure escalating after one of the worst weeks in its almost 15-year-history, Tesla Inc raced to manufacture and deliver its mission-critical Model 3 sedan to burnish the numbers it’s about to report to rattled investors.
Tesla’s Fremont, California, delivery hub was packed with people on Saturday evening as the last hours of the quarter drew to a close. Red couches and tall white tables were set up outside, a DJ played music and a truck selling Vietnamese food was on hand. Behind the scenes, a company that’s struggled to figure out how to mass manufacture cars had implored workers to get production on track and disprove their doubters.
The sceptics are getting louder after the last few days. The electric-car maker led by Elon Musk has come under regulatory scrutiny for the second crash this year involving Tesla’s driver-assistance system Autopilot, the latest of which resulted in a fatality. Moody’s Investors Service downgraded the company’s credit rating further into junk, citing the combination of production problems and mounting obligations that could necessitate a more than US$2bil capital raise soon to avoid running out of cash. “Tesla is testing our patience,” Gene Munster, a managing partner at venture capital firm Loup Ventures who’s been bullish on the carmaker, wrote in a report after the company announced it would have to repair a power-steering issue with the Model S on Thursday. “When we heard the recall news tonight we asked ourselves, do we still believe in the story?”
Musk, 46, risked coming off as tone deaf to investor concerns, sending a series of April Fools’ Day tweets to joke that Tesla had gone bankrupt.
The chief executive officer first unveiled the Model 3 on March 31, 2016, and Tesla’s manufacturing woes have kept hundreds of thousands of consumers who placed US$1,000 deposits for the sedan waiting.
From the looks of social media posts by customers who took delivery of their Model 3 over the holiday weekend, Tesla still maintains an army of true believers who are staying put in line for their car. “Two years ago to the day, I put down a deposit on a car I’d never even seen before,” Amanda Bell, a software developer in Nashville, wrote last Saturday on Twitter. “Today, I picked up my dream car.”