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Tesla Employees Say Automaker Is Churning Out a High Volume of Flawed Parts (cnbc.com)
Several current and former employees of Tesla said that the automaker is manufacturing a surprisingly high ratio of flawed parts and vehicles, leading to more rework and repairs than can be contained at its factory in Fremont, California. CNBC reports: One current Tesla engineer estimated that 40 percent of the parts made or received at its Fremont factory require rework. The need for reviews of parts coming off the line, and rework, has contributed to Model 3 delays, the engineer said. Another current employee from Tesla's Fremont factory said the company's defect rate is so high that it's hard to hit production targets. Inability to hit the numbers is in turn hurting employee morale. To deal with a backlog of flawed parts and vehicles, said these current and former employees, Tesla has brought in teams of technicians and engineers from its service centers and remanufacturing lines to help with rework and repairs on site in Fremont. They also said that sometimes the luxury EV maker has taken the unusual measure of sending flawed or damaged parts from Fremont to its remanufacturing facility in Lathrop, California, about 50 miles away, instead of fixing those parts "in-line." Tesla flatly denies that its remanufacturing teams engage in rework. "Our remanufacturing team does not 'rework' cars," a spokesperson said. The company said the employees might be conflating rework and remanufacturing. It also said every vehicle is subjected to rigorous quality control involving more than 500 inspections and tests. The report from CNBC has caused Tesla's stock to tumble today. You can read Tesla's full statement about the CNBC report here.
From the blurb; emphasis mine:
Several current and former employees of Tesla said that the automaker is manufacturing a surprisingly high ratio of lawed parts and vehicles, leading to more rework and repairs than can be contained at its factory in Fremont, California.
That's ok, Slashdot has had plenty of time to work out all of its kinks in the supply chain for their product and, yet, we still see a surprisingly high ratio of flawed spelling.
The report from CNBC has caused Tesla's stock to tumble today.
Remember all the Tesla fires? The stock tumbled then and I managed to get in at the bottom of that particular drop.
I'll never understand how or why the markets are absolutely eager for anything remotely bad about Tesla Motors so they can let their fear-ridden backbrains take over and sell in a panic. Fine I will just buy then.
As to the issue: new factories pushing the edge on new kinds of parts will inevitably have issues of this kind. I would be more concerned if they reported a zero or tiny defect rate. That would indicate that the QA dept is not doing its job and somebody is hiding something.
Bottom line: Tesla revenues are supply limited. Specifically supply of batteries. They have a huge backlog of sales. Yes a 40% defect rate of something is a problem and has to be fixed. I have seen defect rates like that and worse on stable product that hasn't changed in 5 years. That is why there is a career in supply chain management. That is why there is a career in Quality Assurance.
But if you have a backlog and you have funding (Tesla has both) these problems will be fixed. The stock price drop has to do with the market obsession with making this quarter's shipments and revenue numbers and nothing else.
Had this not made the news I would have been surprised if this had even reached Elon's desk.
....in their parts department, I can tell you that pretty much every model of car manufactured has some certain parts from some certain providers that are notorious for failing. This is what led to Toyota achieving such dominance today: they learned the "Barney Fife" lesson - "Nip it in the bud, Anj! Nip it in the bud!". They relentlessly send their engineers into their parts provider's lines to perform front-line QA and "kaizen" (continuous quality feedback). Tesla seems like they want to get there, and will - I believe - but as with all complex systems, there is lots to learn (and relearn) along the way.