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Tesla Plans To Produce 500,000 Electric Cars In 2018, 1 Million In 2020 (reuters.com)

"Tesla Motors Inc said it was stepping up production plans for its upcoming Model 3 mass-market sedan and would build a total of 500,000 all-electric vehicles in 2018, two years ahead of schedule, but warned that spending will ramp up in tandem," reports Reuters. Tesla said capital spending would rise about 50% more than originally planned this year, to around $2.25 billion. Producing 500,000 vehicles in 2018 will be no easy task, especially considering the company is only on track to deliver between 80,000 and 90,000 electric vehicles this year. In addition to producing 500,000 electric vehicles in 2018, Elon Musk also said the company expects to produce nearly 1 million vehicles in 2020. These are certainly ambitious goals, even for a company that had the 'biggest one-week launch of any product ever.'

45 of 88 comments (clear)

  1. Never by Anonymous Coward · · Score: 1

    Never gonna happen. One thing is for certain. SpaceX and Tesla both never make their ridiculous overly ambitious timeline goals.

    1. Re:Never by Chuq · · Score: 2

      Tesla sells internationally - notably Canada, China and across Europe, but as of Model 3 also Mexico, India and Brazil.

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      - Chuq
    2. Re:Never by WarJolt · · Score: 1

      Yes, but have you seen most of the cars in the countries you mentioned. Most cars are far from new.

    3. Re:Never by Anonymous Coward · · Score: 3, Insightful

      Okay, smart guy.

      Tesla currently has Supercharger facilities (which I'm using as a convenient proxy for "countries it sells its vehicles to") in Australia, Western Europe, China, Japan, the USA, and Canada. Japan, in particular, has very strict regulations on cars that mean that its car fleet is generally very new; it's rare to see a car older than eight to ten years old on Japanese roads, and there would be a huge appeal in that country to buying an electrical vehicle, thanks to their stringent emissions controls. I'd expect the Model 3 to be a significant part of that country's market, early in the game.

      Globally, car sales are over 74 million per annum. One million vehicles would represent about 1.35% of global vehicle sales - not an easy target to reach, but I think there's a reasonable chance they can do it, if they stick to a relatively conservative and well-understood (from an engineering point of view) design. The Model X's doors are a perfect example of how not to do it - sure, over time, they'll get better, but for a mass market vehicle, you want to keep it simple, keep it familiar, and thereby minimise the risks to the ramp-up. (That said, as the technology in the Model X is bedded down, it will probably find its way into other vehicles. I just don't think that the early model 3s would be the right place for it.)

    4. Re: Never by thinkwaitfast · · Score: 2, Interesting
      Cars are about the worst investment that you can make. They're largely for showing off how much money you have to waste. Maybe boats are worse.

      I can buy low cost house for not much more than a new car and turn it into source of income. Given this choice, I'll keep driving my 30 year old POS (that works perfectly well BtW) and buy more houses.

    5. Re:Never by jblues · · Score: 1

      In my country most cars are far from new, but the neighborhood where I live has a lot of new high-end and mid-tier cars. The city has a high population, so there's plenty of market here for them too. Traditional auto-makers don't turn their nose up at these markets and neither should Tesla. I hope they do well on rough roads though.

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    6. Re: Never by Bing+Tsher+E · · Score: 2

      Not to detract, but it sounds like you made a good investment in that car 30 years ago. And it sounds like you invest your money well in proper maintenance.

    7. Re: Never by thinkwaitfast · · Score: 1

      Hah...not really. I just don't drive a lot, and when I do it's mostly long distance highway. It's only been washed twice (and not by me).

    8. Re:Never by Zuriel · · Score: 1

      Tesla have said that the Model 3 was designed to be easy to manufacture. I can't see something like the falcon wing doors being included. Until we get to about 2025 and the Model 4 takes over as the affordable car, then we'll see bells and whistles in Model 3...

    9. Re: Never by tweissin · · Score: 1

      You obviously don't live up north. The salt on the roads in the winter chew up a car's exterior. Also what part of the country do you live where there is a house the cost of an average car?

    10. Re: Never by Anonymous Coward · · Score: 1

      That's what I'm jealous of. Houses that cost not much more than a new car. Here in Europe a house that has been declared uninhabitable still costs 190,000 euro. You have to pay for the costs to break down the house and pay for the cost to build a new house. That is the cheapest house in my environment at the moment and it is even a terraced house without garden nor place to park your car.

      If I had half a million spare, I would think about buying houses. It is still worth the investment, but the upfront costs are insane over here.

    11. Re: Never by Type44Q · · Score: 1

      I agree: statements like that definitely merit posting as AC...

    12. Re: Never by Type44Q · · Score: 1

      ...but it sounds like you made a good investment

      More like a worthwhile expenditure. "Investment" has different meaning entirely.

    13. Re: Never by Type44Q · · Score: 1

      Also what part of the country do you live where there is a house the cost of an average car?

      Somewhere with a wage-structure so suppressed that $45k will buy you a liveable house... and those of us with any sense would still rather take a bullet than live there. Places like Oklahoma comes to mind.

    14. Re:Never by fbobraga · · Score: 1

      Most cars are far from new.

      It's false here on Brazil: most cars here are new or have few years from manufacturing - I think it's wrong in other countries in the list too: may be a common misconception ("Cuba-related"?)...

    15. Re: Never by thinkwaitfast · · Score: 1

      No, a house that will pay for itself with tenants. And who cares if you want to die, I'm just in it for the money.

    16. Re: Never by thinkwaitfast · · Score: 1
      You should have been here at the end of 2008. Perfectly livable (as evidenced by the many people living there) 40 year old tract houses were being sold as low as 10k! A friend of mine (fellow engineer) took all of his savings, around $200k, and bought a bunch, fixed them up and now rents them for $1500/mnth. Not to mention now that the market as recovered, they're worth 10x what he paid for them (with cash).

      There are a lot of immigrant dense neighborhoods around and people without a lot of money need places to live. On top of that, many have good blue collar skills and can improve the house while living in it for reduced rates.

    17. Re: Never by Bing+Tsher+E · · Score: 1

      and those of us with any sense would still rather take a bullet than live there.

      The Internet has really flattened out the world, and made it tolerable, even pleasant, to live in many places that would be unlivable a few decades ago.

      Twenty years ago the town I live outside of was small-town Midwest, with a few stores and everything shut down at six on weekdays. Even shorter hours on the weekends. The cultural 'connection' was a Sam Goodies outlet at the strip mall on the outskirts of town.

      Today, even a nerd like me can feel connected and in touch by reaching out over electronic forums. Music by artists I like, I can order over Bandcamp. The fact that one of my favorite musical groups is based in Amsterdam doesn't block me from enjoying their latest work as it comes out.

      I would probably still be in Minneapolis without the Internet allowing me to stay connected with my interests. But when I moved here from Minneapolis, I was able to sell a two bedroom town house for the same amount of money I paid for a comfortable 19th century house on Five acres here.

    18. Re: Never by umberleigh · · Score: 1

      Whilst I agree the internet is fantastic for connecting with your interests and makes living in a small town tolerable, until we have the metaverse there's still no replacement for living in a city that fits you. I grew up in a small town about an hour away from London, England with nothing to do and nobody that shared my interests close by. The internet made it just barely tolerable, but it's not the same as being able to share your interests with people who live a few minutes walk away and connecting with people face-to-face. For instance you have the opportunity of going to actually see those artists you like play gigs live in the flesh.

  2. They don't have the capital. by Anonymous Coward · · Score: 1

    Do some basic research. They've never made more than about 11,000 cars a month. They don't have enough capital to build the manufacturing capacity to make that many cars.

    They seem to have tricked a few of you.

    Tesla is a religion that makes electric cars.

  3. Dear Elon by ChunderDownunder · · Score: 1

    Ramping up production - any plans to manufacture in Australia? You'd have your choice of factory and a monopoly on production once Ford, General Motors and Toyota all exit the market in a year or two, meaning lots of skilled, unemployed workers.

    Add a possible change of government come July, keen to transition to a "low carbon" future where electric vehicles haven't made much of a dent yet.

    Right hand drive vehicles for the UK market...

    1. Re:Dear Elon by Chuq · · Score: 1
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    2. Re:Dear Elon by ChunderDownunder · · Score: 1

      Well at least Weatherill and Turnbull have asked the question, I guess.

      I'd suggest with our sunny climate Tesla would make a killing on locally made Powerwall batteries if the government weren't so blinded by coal.

    3. Re:Dear Elon by Zuriel · · Score: 1

      The only reason the power wall could make sense for individuals is if the electric company overcharges the customer or doesn't pay them enough for the solar power the customer sells back to the grid.

      They do. Australian electricity is fairly expensive and we get pennies for generated solar, so charging your battery during the day when you're not home and using that power at peak time in the evening makes sense, and it will make more sense as the price of solar and batteries comes down.

      The power companies raise rates and cut feed-in tariffs to maintain their profits, which makes more people buy solar and batteries, which means more rate rises and tariff cuts, which means more solar and batteries.

      We could transition to a smart grid, where power is valued depending on how far it needs to be carried from generator to consumer due to the reduced load on the grid. Alternatively, the power companies could spin merrily in their death spiral while crying for government to save them, which seems the most likely possibility.

    4. Re:Dear Elon by BasilBrush · · Score: 2

      The electric company is a business, not a charity. Of course they are going to sell electricity for substantially more then they buy it for. That's what businesses do. So unless a country's government mandates them buying electricity from consumers at a similar price to supplying it, Powerwall makes sense.

      At the grid level, unless you have a very flat country, it makes more sense to use pumped hydro than batteries anyway.

    5. Re:Dear Elon by stoatwblr · · Score: 1

      "At the grid level, unless you have a very flat country, it makes more sense to use pumped hydro than batteries anyway."

      There aren't that many locations suitable for pumped hydro, even in hilly/mountainous terrain.

  4. Re:who cares? by WarJolt · · Score: 1

    Because in California you show up at your smug friends house in a Tesla and your awesome friends house in a Ferrari. Don't let those two intermingle. That's just all bad. You'll be cleaning smugness off for weeks and you can't just drop your smug friend because he knows a guy who knows a guy who can get things done.

  5. At this point I am ready for everything by mapkinase · · Score: 3, Interesting

    I'll drive a car running on the blood of freshly killed babies if I won't drive it.

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  6. Elon will lead us out of the ICE desert! by rdelsambuco · · Score: 1

    So shall it be written, so shall it be done.

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    1. Re:Elon will lead us out of the ICE desert! by zlives · · Score: 1

      wish in one hand, shit in the other...

  7. Re:Skeptical of this by CaptainLard · · Score: 1

    Great! If you're skeptical that means someone else is being ambitious. Something we could use much more of in fields other than new chat apps.

  8. Re:Skeptical of this by Mr+D+from+63 · · Score: 1

    It will be easier to manufacture and excuse or two. And even more people will buy those.

  9. Re:Cars, cars, cars by AaronW · · Score: 4, Informative

    Those issues are rapidly diminishing in many areas. Charging stations are popping up all over. I've been driving my Model S since 2013, and the number of places I can't take it is rapidly shrinking. I go on an annual camping trip in the eastern Sierra Nevada mountains and this will be the first year I won't need to borrow a gasoline car for the trip since the main highway is now covered (highway 395). As for service centers, those also are popping up in many places, though some states are actively trying to prevent them.

    My experience with Tesla service is night and day compared to my experience with Toyota. Toyota always tried to push a bunch of crap on me. They'd try and push blinker fluid if they thought they could get away with it. I'd have to fight with them when my car had common well-known problems. With Tesla there's never any question and they address the problem. My car has had more issues than the newer ones since it is a low VIN number but most of those issues were squeaks and rattles, which is difficult for any manufacturer to get right, especially with a brand new model from a new company out of a new factory. Hell, with Tesla I don't need AAA for towing since Tesla's service is better since there is no limit on distance or the number of times you can use it. I have had to use it once, and it was due to a tire that I bought through Tirerack and had installed by a third party developing a bubble in the sidewall. There were no questions nor was I billed for a tow home where I could go to my local dealer for a replacement tire since they discount the tires.

    For those who don't live near a service center, they will come to you for an extra $100 fee.

    All one has to do is look at Tesla's upcoming 2016 map of chargers to see how quickly they're planning on expanding it. Tesla has already said that they plan to double the number of charging spots by the end of the year and I expect similar growth in 2017. The superchargers are the big game changer for Tesla. Nobody else can boast having an EV which can be driven across the country without spending huge amounts of time charging. Last September I had no problems or significant delays driving from the Bay Area to Seattle. It took me 2 days and charging only added 3-4 hours to the entire trip. The time often wasn't wasted either. I used it to stretch my legs and grab a bite to eat. If I were driving a gas car I'd also take 2 days for this drive since I'm not about to drive 14-16 hours straight.

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  10. Re:Cars, cars, cars by Kokuyo · · Score: 1

    Now if only I was better at saving cash...

  11. Re:can do by Sique · · Score: 1

    Don't they sell the Nissan Leaf?

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  12. Re:Cars, cars, cars by mapkinase · · Score: 1

    One look at the posted map leaves no doubt that Tesla remains heavily rich-centered company. Even metropolitan centers have very few centers, located in the highest cost of living areas.

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  13. Re:Cars, cars, cars by berberine · · Score: 2

    All one has to do is look at Tesla's upcoming 2016 map of chargers to see how quickly they're planning on expanding it. Tesla has already said that they plan to double the number of charging spots by the end of the year and I expect similar growth in 2017. The superchargers are the big game changer for Tesla. Nobody else can boast having an EV which can be driven across the country without spending huge amounts of time charging. Last September I had no problems or significant delays driving from the Bay Area to Seattle. It took me 2 days and charging only added 3-4 hours to the entire trip. The time often wasn't wasted either. I used it to stretch my legs and grab a bite to eat. If I were driving a gas car I'd also take 2 days for this drive since I'm not about to drive 14-16 hours straight.

    They aren't expanding to western Nebraska. It's 402 miles from Scottsbluff to Lincoln. In my car, that's one stop for about 10 minutes max to fill up with gas. The model 3 doesn't have a range listed. The X and S say 237-294. At the low end that's two stops just to get to my destination, which adds at least 75 minutes to each trip. Oh yeah, there aren't any charging stations on that route and none planned so Tesla is still out for many people in this area.

    There are many people in western Nebraska who travel to Lincoln, Omaha, Cheyenne, Denver, Ft. Collins, Loveland on a regular basis. They aren't going to want to fuck around and wait 75 minutes or more for shit to charge.

    Also, I do drive 14-16 hours straight once a year visiting my mother. It's a 28 hour drive and I do it in two days. I'm not even going to do the math on how much time will be wasted charging these things.

    My tank of gas gets me 375-425 miles, depending on traffic and how much stuff I have in the car. The Teslas simply can't compete with that. I also paid $18,000 new for it. Tesla can't touch that. While Teslas are great in major urban areas where people just tool around the city to and from work, running errands, etc, that's fine. But it hasn't even tried to reach rural areas yet. I don't see that changing for another 10 years.

  14. Yeah Good Luck with that by Anonymous Coward · · Score: 1

    Musk talks a big game in Tesla, but the problem with car production is people may get excited about the concept of an electric car but they won't buy if the door handles don't work, if the power train needs to be completely replaced and overhauled every 60,000 miles, if the roof doesn't fit, if the emergency brake kicks in every 6 seconds, and if the doors won't close, all of which have been common problems with the Model S and the Model X.

    A car is a complex piece of machinery with many points of failure and the consumer of the cheaper vehicle expects those things to work. Model S owners may be willing to ignore busted power trains, and Model X owners may be willing to forgive a stupid door design you can't open in standard garage; they likely have other cars and can manage an expensive but poorly functional car. But the target market for a $35,000 car likely can't afford to have an expensive lemon in the garage; they're more likely 2 income families driving their kids to school before working a 9 to 5 to pay the rent or barely make mortgage. They won't accept having to hold the driver side door closed with one hand while driving their kids' carpool.

    http://techcrunch.com/2016/04/20/tesla-model-x-owners-finding-car-doors-wont-shut-windows-wont-close/

    If Tesla has this level of quality issues producing 50,000 cars per year, those problems will only grow exponentially when ramping production by 10X. Greg Reichow and Gilbert Passin must be freaking out with anxiety at that. Tesla doesn't have the financials to support recalls and warranties with those kinds of quality problems and they'll be doing recalls like crazy if they don't fix those before delivery or they'll be sunk just on warranty costs.

    1. Re:Yeah Good Luck with that by AlanObject · · Score: 1

      car but they won't buy if the door handles don't work, if the power train needs to be completely replaced and overhauled every 60,000 miles, if the roof doesn't fit, if the emergency brake kicks in every 6 seconds, and if the doors won't close, all of which have been common problems with the Model S and the Model X.

      Always amazing how these kinds of problems don't seem to count when they appear on BMWs, Fords, Audis, Toyotas, or anything else, but in the case of Tesla they are always the defining deal breaker. Always presented smugly as above. Yet still Tesla remains supply limited with backorders as far as the eye can see and its customer loyalty and satisfaction remains at phenomenal levels. I guess all those tens of thousands of people who can affording simply love wasting their money.

      I have heard of cars with ignition switches that cause freeway fatalities, accelerator pedals that get stuck, tires that blow out unexpectedly, massive recalls all the time on stuff both dangerous or merely annoying. Somehow that never seems to be a problem for the efficacy of the companies that cause them.

      I remember two years back about all the "Tesla car fires." The lizard-brain gullible market responded with a huge stock value drop and that's when I bought as much as I could. Never regretted it.

  15. Re:Cars, cars, cars by itsdapead · · Score: 1

    One look at the posted map leaves no doubt that Tesla remains heavily rich-centered company.

    The fact that the "affordable" Model 3 still costs BMW-3-series-money shouldn't leave any doubt of that to start with.

    That said, the point of EVs is that most of the time you charge them at home and only need a charging station when making long trips, so the need for charging stations in cities & residential areas is reduced - they're needed along long-distance routes and at hotels, 'destination' shopping malls etc. The "high cost of living areas" are also the places that people are likely to take road trips to visit for business/pleasure.

    A solution is needed for 'home charging' if you don't have a driveway or garage, but driving to a 'local' public charging station isn't going to entice people to buy EVs. I don't see high-density residential areas that already have parking problems welcoming roadside charging points unless they are 'residents only'.

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  16. Re:Cars, cars, cars by CastrTroy · · Score: 1

    There's only 1.8 million people in all of Nebraska. It doesn't really mattter that the Tesla concept doesn't work for every single person in the country. As long as they can get it to work for the large population centers like California, New York, etc, they can probably cover 60% of the US population.

    Also, for People doing that one trip a year where to visit family, they would probably be better off renting a gasoline car and saving money year round by paying less to operate the electric car for the year.

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  17. Re:Cars, cars, cars by AaronW · · Score: 1

    Most owners install a 240V 50A outlet in their garages. The outlet is around $14 at Home Depot. Of course that doesn't count the wiring and breaker, but generally it isn't all that expensive.

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  18. Re:Cars, cars, cars by AaronW · · Score: 1

    The cars are highly profitable with margins of over 25%. One needs to look at where all that money is going. Tesla could be profitable any time they want to, but if they did so they would remain a niche market and could never produce a car like the model 3. All of that money is being spent on capital needed to grow their business like the gigafactory. It also takes a lot of capital to put together a factory to build a high volume of cars. Tesla's problem is that they are supply constrained and it takes a lot of money to address this.

    I have over 40,000 miles on my model S. To date I have not had a single major problem with it and I tend to have a lead foot. I don't think the issues of the model X will affect the model 3 since the model 3 doesn't have the falcon wing doors nor will it have the complex seats that the X has.

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  19. Re: Cars, cars, cars by WindBourne · · Score: 1

    Tesla is going to be building on I80 this year and into 2017. Because Nebraska us lightly populated and your gov will not allow them to sell there,ne is not a top priority. Besides, u have huskers there and nobody wants to see them :)

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  20. Re:Cars, cars, cars by stoatwblr · · Score: 1

    "Tesla could be profitable any time they want to, but if they did so they would remain a niche market and could never produce a car like the model 3"

    The thing to bear in mind is that carmakers traditionally make far more money selling car parts (or in Ford's case, finance deals) than cars.

    Tesla's focus isn't cars or car parts. It's batteries - and not just in Teslas, or even in cars.

    The objective is to produce a large enough market for large batteries for economies of scale to kick in enough to lower prices and spur demand. Bear in mind that patents have been used for the last 20 years to keep automotive traction batteries uncompetitive and some of those patents recently expired.

    https://en.wikipedia.org/wiki/...