Originally published on CleanTechnica
Tesla announced earnings for the first quarter of 2017 today and the message is loud and clear about the Model 3 — Tesla is on track for the move to production and ramping up its infrastructure across the board in support of the launch.
Starting with the most foundational of Model 3 activities, Model 3 production is on track with all production-ready manufacturing equipment set to start working in July for honest-to-goodness manufacturing:
“Model 3 activities related to vehicle development, manufacturing equipment installation and supplier readiness remain on plan to start production in July.”
The letter continues by unpacking the work Tesla is doing to improve its overall geographic footprint across the globe.
“We are significantly expanding our infrastructure to support Tesla owners by increasing the density and geographic footprint of our presence.”
This comes on the heels of Tesla’s focused announcement that the Tesla Supercharger network will be doubling in 2017.
All signs point to Tesla’s gamble on installing production-capable manufacturing equipment right off the bat vs installing special, essentially disposable equipment and then upgrading to full-volume equipment after the release candidate vehicles are validated. The release candidate vehicles have been built so that improvements can be taken back to the manufacturing process to ensure it is capable of supporting Model 3 production at scale — at quality targets.
As the world has already seen, release candidates are also getting out in public for real-world road testing as part of the validation process.
Digging into the details of the manufacturing lines, Tesla has brought its latest Schuler press line up and has started the commissioning process for it in preparation for Model 3 production. This timing is in-line with the planned Model 3 ramp and allows “sufficient time to install and tune die sets ahead of volume production.”
On the supplier front, Tesla is also pounding on the upstream suppliers to ensure it doesn’t hit any roadblocks like those encountered with the Model X production ramp, which had serious issues with the components required for the second-row seats, supersplendulous windshield, and falcon-wing doors.
Beyond just physical service centers, Tesla has moved forward with mobile service teams and is ramping up from the pilot of just a single mobile service vehicle to a fleet of over 100 mobile service vehicles by the end of Q2 2017. Tesla notes that it has built its vehicles to be largely serviceable without the need for a lift, which means mobile service is much easier to accomplish at the home or business of a customer, which saves the customer the time and effort of traveling to and from a service center (SC) as well as the non-value-add logistics associated with a SC visit.
I personally found the Ranger Service to be extremely user-friendly when a tech came to my home to swap out a door handle on my Model S while I made dinner for my family in the next room.
Tesla has also done work to continue to drive service times down. Specifically, it has continued to leverage proactive and reactive remote diagnostics to identify and flag service items before they leave a driver stranded on the side of a road. This has the potential to drive the uptime of Tesla vehicles up higher than any other competitor, as no other automotive manufacturer has or is using this type of advanced, remote diagnostic capabilities today. The work done to drive service times down this year has resulted in reductions of repair times by 35% this year alone.
A 30% increase in physical footprint density is also in the works for this year, with over 100 new retail, delivery, and service locations globally in parallel to the previously communicated doubling of the Supercharger network in 2017 to 10,000 stations and a 4-fold increase in the destination charger network density to 15,000.
Tesla is also moving into the body shop business, which is a part of the service model that it has historically outsourced. Body work has been a source of significant headaches and delays for users, with the rear quarter panels being a known constraint that regularly cause delays of several months due to their complexity, lead time for parts ordering, and the sheer effort required to remove and rebuild that section of the vehicle.
On the investors call, which CleanTechnica joined, the Tesla team noted that there has been a significant ramp in the number of loaners the company is keeping ready to ensure owners have a Tesla to borrow when their vehicle is in for service. The company noted that it is stocking well-equipped vehicles to give owners the best experience and to make service a positive experience to the point where they will be sad when it’s over. If a fleet of loaner Model X P100Ds are sitting at the ready, Tesla may see an increase in service requests from owners. 🙂
That positive experience could also lead to more upgrades and Model X or S sales. As reported in our freshly released second-annual EV report, the largest percentage of current EV drivers in Europe and North America plan to next buy a Tesla Model 3, but another large portion of initial EV drivers plan to buy a Model S or X next. In fact, among current Tesla drivers, approximately 26% plan to next buy a/another Model S and 10–11% plan to next buy a/another Model X.