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Jul 2, 2018

Tesla holds some Model 3 output after exceeding target

Tesla Model 3

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Tesla Inc. is scheduling a break for some Model 3 production after exceeding a closely watched target for the final week of the second quarter, according to people familiar with the matter.

The electric-car maker will resume production Thursday, said two of the people, who asked not to be identified because the plans aren’t public. The break won’t impact production targets and will allow the company to do basic upkeep and maintenance work.

Tesla (TSLA.O) reported earlier Monday that Model 3 output reached 5,031 in the final seven days of June, beating a 5,000-car target that Chief Executive Officer Elon Musk had said was crucial to generating cash and earning profit. About 20 percent of those sedans came off a makeshift line that the company built last month underneath a tent outside its California assembly plant.

Tesla shares closed down 2.3 per cent on Monday as some analysts questioned whether the company will be able to sustain higher production rates. The carmaker forecast that it’ll be able to build 6,000 Model 3s a week by late August.

Part of the break in Model 3 production includes Wednesday’s July 4 national holiday. It’s common for automakers in the U.S. to schedule summer shutdowns around this holiday for maintenance work.