The Tesla Model 3 is the most anticipated luxury automobile of the year, although that fact alone might be causing woes to Ellon Musk's multibillion company. Given the high number of demands for the mass-produced automatic sedan, Tesla is having a hard time meeting the target output. As a solution to the "production bottleneck," Tesla is reportedly slashing the parts order from manufacturers.
As reported by Business Insider, Tesla is planning to cut down the orders for the Model 3 components by 40 percent. This was confirmed by the Taiwanese auto parts supplier, Hota Industrial Manufacturing. As a direct effect, shares of the company went down by nine percent. The decision to decrease the volume of parts order from Hota will take effect in September, decreasing the numbers from 5,000 sets to 3,000 sets of car components per week.
Tesla is also expected to delay shipments of 10,000 car components by a few weeks starting March. The delay may continue until May or June, depending on the status of Tesla Model 3 production. Previous reports already hinted that Tesla is experiencing bottlenecks that put the company behind schedule. The carmaker should be increasing the rate of production in the last months of 2017, although certain factors hampered their plans. The actual production of Model 3 units began in July.
The reason behind the slow-down of Tesla Model 3 production is not specified. However, Reuters reported that one of the reasons could be the in-house job demanded by Musk for the car seats. It was said that the Tesla executive has grown frustrated with the output of an outside contractor providing seats for the Model 3 that he pushed the company to produce their own.
Nevertheless, Musk's decision to make the car seat production in-house could be justifiable. It was reported that Tesla has already ordered recalls of their car units over the past four years, which have something to do with car seat issues. The most recent recall due to seating problem was made a few weeks ago, when 11,000 Model X units were pulled back.
