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Tesla Model 3 Production Keeps Ramping — Hitting Near 2,400 Per Week in Early April

Past behavior can often be predictive of future results. Sometimes, however, we are pleasantly surprised. Such is the case with Tesla’s Model 3 production ramp this week.

Tesla’s Big Surge Continues

According to reports from both Electrek and Bloomberg, Tesla appears to have sustained weekly rates of Model 3 production above 2,000 for more than 14 days. Indicators for this continued surge come in the form of record VIN number releases. For since late March, the number of Model 3 VINs ordered from the U.S. government has doubled from approximately 14,000 to around 28,000. Meanwhile, Bloomberg’s Model 3 production tracker has surged to 2,394 all-electric vehicles per week. A new record.

(Bloomberg’s Model 3 tracker has captured a big surge in Model 3 production translating through to early Q2. Image source: Bloomberg.)

The big jump in VINs comes along with Tesla CEO Elon Musk’s announcement that he planned to continue Model 3 production rates of over 2,000 vehicles per week into early April. This higher production rate is contrary to past production behavior by Tesla — which typically surges late in a financial quarter and then backs off at the start of a new quarter.

5,000 Per Week Model 3 Production Goal in Sight

And though it is still possible that we could see all-electric, zero-tailpipe emissions Model 3 production slackening a bit following this most recent, apparent much longer-running surge, there are indications that Tesla’s capability is rapidly expanding. First, it appears that two lines are now running for Tesla Model 3 and related battery production. Second, it appears that many of the Model 3 bottlenecks have been addressed. And, third, it looks like new Model 3 production infrastructure continues to spring up in the form of dedicated facilities at Tesla’s Fremont plant and Nevada Gigafactory.

(A drone fly-over of the Tesla Fremont factory shows new buildings that appear to be dedicated to Model 3 production efforts. Video source: Tesla Factory Flyover Drone.)

Tesla’s production legs are, therefore, growing longer. And, in light of this fact, it appears that our earlier estimate that Model 3 would produce between 17,000 and 27,000 during Q2 may fall a bit short. As a result, that estimate is now adjusted upward to 18,000-30,000. This steepening ramp is increasingly possible especially if Tesla is able to maintain production rates in excess of 2,000 Model 3s per week through April and May even as it attempts a surge to 5,000 Model 3s per week by June.

Diversification of Model Line Planned For July

Tesla presently still has around 470,000 reservation holders for the Model 3. However, it’s uncertain how many of these are waiting for the long-range, rear-wheel drive version that is now in production. Past indicators are that the number is around 100 to 120K. Most of the rest either appear to be holding out for the dual motor version or for the lower price version. A 5,000 vehicle per week production rate will quickly eat through remaining long range, rear wheel reservation holders. And it is likely for this reason that Elon Musk is planning to start looking at producing the dual motor Model 3 during July of 2018.

So not only is the pace of Model 3 production quickening, the advent of new Model 3 versions is on the horizon. All-in-all this is good news for Model 3 reservation holders and for renewable energy/climate change response backers in general. We’ll have to watch Tesla indicators closely. But it appears, more and more, that the company is able to put Model 3 production hell behind it. To step it out as an all clean energy mass producer.

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