“There’s no way you need 10,000 people even with three shifts and with a lot of work done in house,” Munro said.
Another reason for the elevated headcount is that the indoor assembly line, which Tesla calls GA3, had an automated conveyance system that failed. In the spring, Tesla finally ripped it out and used the parts to build the new assembly line under a gigantic tent.
Again, the design of the Model 3 contributed to the problem: Munro said its many weld points and rivets are just not designed for heavy automation. Musk admitted as much when he tweeted in April that “excessive automation at Tesla was a mistake.”
“There’s clearly too much human integration in manufacturing, and that's true with the Model S and X, too,” said James Albertine, analyst with Consumer Edge Research LLC. “Elon’s focus has been on better battery range and performance.”
While Tesla's manufacturing process would have benefited from a more old-school approach, the company has an edge with regards to technology. The 75 kilowatt hour battery inside a Model 3 goes 310 miles on a charge, about 70 miles further than a Chevy Bolt and about triple what the BMW i3 can do. Tesla’s battery costs more than $13,000, Munro estimates, about $1,000 more than a Bolt.
The Model 3 not only goes farther on a charge—it’s a lot faster due to the advanced electric motor. Tesla’s motor costs $754 a car compared to $836 for the Bolt. The teardown by Munro’s team revealed an advanced design that uses powerful magnets to spin faster and generate more power. “This electric motor is a game changer,” he said. “Everyone should be benchmarking this.”
The software and electronics are also better. Munro found that Tesla reduced the amount of wiring snaking through the car by concentrating a lot of the electronics in small circuit boards. That’s knowledge from Silicon Valley that the carmakers don’t have.
The trick now is turning this established technological advantage into consistent profits—and to do that Musk needs to hire executives with experience in the nuts and bolts of carmaking. If he does, Munro said, “he’s not far away from making money.”
This article was provided by Bloomberg News.