In the coming months, Tesla plans to shut down production for about 10 days in total, the company said on Wednesday in a letter to investors, as it plans to ramp up production of the Model 3 sedan to 5,000 units per week.
Tesla said Model 3 production hit 2,270 per week in April for the third straight week of making at least 2,000—but still below where CEO Elon Musk said the automaker would be by now. Net orders for the Model 3 are still holding strong at 450,000, the company said.
Interestingly, as Tesla said it’s trying to become profitable by the end of the year, the company said it has “significantly cut back our capex projections by focusing on the critical near-term needs that benefit us primarily in the next couple of years.”
At this stage, we are expecting total 2018 capex to be slightly below $3 billion, which is below the total 2017 level of $3.4 billion. Ultimately, our capex guidance will develop in line with Model 3 production and profitability. We will be able to adjust our capital expenditures significantly depending on our operating cash generation.
The company said it has $2.7 billion in cash on hand at the end of the first quarter in 2018. Musk has said he doesn’t expect Tesla to need to raise additional funds to support the Model 3 production ramp.
A conference call with investors is planned for 5:30 p.m. EDT.
Update (5:43 p.m.): Conference call is underway. In his comments to kick off the call, Musk reiterated his earlier points that Tesla automated the Model 3 production line too much, saying: “We automated some pretty silly things.”
One example? Fluffer Bot. That’s the apparent name of a robot that was used to place fiberglass matts on top of battery packs. It was quite a mess, it seems.
Musk also said there has been “radical” improvements in Model 3 production. As of three weeks ago, at the company’s Gigafactory in Nevada, he said, it took an average of seven hours to make battery packs.
That number has been substantially reduced, he said. Reporters on the call heard Musk say it’s at “17" minutes per pack now, but Jalopnik obtained an email Musk sent to the company earlier today that says it’s actually higher.
Per the email, sent at 2:26 p.m. PDT, Musk said it’s at 70 minutes per pack now.
A Tesla spokesperson confirmed the figure is 70 minutes per pack.
More as we get it.