Tesla Inc. (TSLA) rolled out 7,000 cars during the last week of its second quarter, including 5,000 Model 3 electric sedans.
The electric car manufacturer met its Model 3 production goals after erecting a new assembly line in a huge tent outside its main factory and getting staff to work extra shifts. According to Reuters, the 5,000th Model 3 completed its final checks at around 5 a.m. PDT, several hours after the midnight target set by CEO Elon Musk.
7000 cars, 7 days
♥️ Tesla Team ♥️
— Elon Musk (@elonmusk) July 1, 2018
“We did it!! What an incredible job by an amazing team. Couldn’t be more proud to work with you. It is an honor,” said Musk in an email to employees, according to Bloomberg. “Not only did we factory gate over 5,000 Model 3’s, but we also achieved the S & X production target for a combined 7,000 vehicle week!”
In the email, Musk claimed that the achievement made Tesla “a real car company” and expressed his confidence that production delays are now a thing of the past. “With the widespread productivity gains throughout Tesla and the new production lines spooling up, we are on track to reach 6K/week for Model 3 next month,” he said.
Tesla’s second quarter accomplishment represents an important milestone for the electric car manufacturer. In previous quarters, the company failed to meet its self-imposed production targets due to an overdependence on factory automation lines and battery production issues.
These delays led Tesla to burn through a worrying amount of cash and risked stripping the company of its first-to-market position for mid-priced, long-range battery electric cars as competitors begin launching rival offerings.
Investors will now be eager to ascertain whether Tesla can consistently manufacture such a high volume of cars over a longer time frame. The company is known for temporary periods of quick production, but has yet to prove to investors that its short manufacturing bursts are sustainable.
"Hitting this milestone is a win for Tesla, but the real accomplishment will be if the company can keep up this pace," said Jeremy Acevedo, manager of industry analysis at Edmunds, according to website TheStreet. "Erecting a tent and cramming in extra shifts aren't necessarily the signs of a company on a sustainable path, but Tesla has proved at least in the near term that the company is serious about quieting the naysayers and at least trying to keep its promises." (See also: Tesla Asks Model 3 Waitlisters for Another $2,500.)
Tesla is expected to reveal production and delivery numbers for the current quarter later this week. Pierre Ferragu of New Street Research recently wrote in a note reported on by Barron's that investors need to stop chasing exact numbers and focus on whether Tesla is making progress or not.