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Tesla Flies in New Battery Production Line for Nevada Gigafactory

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【Summary】According to a Reuters,Tesla has flown six cargo planes full of robots and other equipment from Europe to California in an unusual, high-stakes effort to speed up battery production for its Model 3 electric sedan.

Paul Young    May 25, 2018 5:24 PM PT
Tesla Flies in New Battery Production Line for Nevada Gigafactory

Tesla CEO Elon Musk is under pressure to deliver the Model 3. Musk said that Model 3 production would reach 5,000 cars per week by June 2018, is just a week away. Now the Tesla CEO is feeling the pressure.

According to a Reuters, Tesla has flown six cargo planes full of robots and other equipment from Europe to California in an unusual, high-stakes effort to speed up battery production for its Model 3 electric sedan. The shipments of new equipment began arriving in Reno this week people familiar with the matter told Reuters this week.

The air freight deliveries coincide with Tesla's planned shutdown next week of its Fremont, California assembly line for upgrades.

Transporting heavy equipment for a production line by air is inherently expensive and unusual. The move shows a sense of urgency for Tesla's CEO as the electric car company works to solve what Musk called "production bottlenecks" and manufacturing problems that have delayed the launch of the mass market Model 3.

"As usual with Tesla, everything is being done in a massive hurry and money seems to be no obstacle," said one of the two sources to Reuters. Tesla is also bleeding cash at an alarming rate. Tesla spent $3.4 billion in 2017.

Tesla declined to comment on whether it has shipped in any new production equipment from Europe.

In February, Musk said the main bottleneck was still its battery module production, saying Tesla had become "a little overconfident, a little complacent" in its ability to execute.

Manufacturing problems have led Tesla to repeatedly miss production targets for the Model 3 sedan, and raised doubts about Musk's promises that the company will stop burning cash by the third quarter of this year. Earlier this month, Tesla disclosed that it could offer its Fremont, California, vehicle assembly plant as collateral for debt.

Engineers from Tesla's German engineering arm, Grohmann, are now reworking the battery production line at the Gigafactory near Reno, Nevada, in a bid to free up bottlenecks, the person said. The line will become more automated gradually over time, added the source, who was not authorized to speak for attribution.

Musk first disclosed plans for this line on a conference call with analysts in November, after complaining of problems with an original line built by a subcontractor.

Musk has told investors the new battery production line will help the carmaker achieve a quantum leap in productivity. The company noted that it will still be able to reach its target of building 5,000 Model 3s per week by June without the addition of the new battery production line.

Under time pressure to fix problems, Musk has now insisted the new production line should be a no-expenses-spared effort, the source said. That led to the decision to airlift the new production equipment to the United States from Europe, a step automakers usually avoid by planning production equipment installations months or years ahead of a production launch.      

It is not clear when the new production system will be ready to start running. Industrial robots frequently need to be recalibrated to adjust for minimal differences in the quality of raw materials they are working with or temperature and humidity differences. Steps to test the quality of materials and recalibrate robots have proven to be a bottleneck that Tesla managers had underestimated, the first source said.

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