Tesla's two top manufacturing execs quit just before Musk announced that he wanted volume production of the Model 3 in 2018 instead of 2020. You can imagine the discussions that went on. Perhaps in time details will surface.
Tesla now faces transitioning from a low-volume high-margin manufacturer to a high-volume low-margin manufacturer. That's hard. HP, IBM, and Xerox tried that, and didn't do too well; all eventually exited the low end and downsized. Even Intel is exiting the low end; they're giving up on the tablet and phone market, as a YC article pointed out a few days ago.
Tesla is trying for good, fast, and cheap at the same time. Tesla's track record is that they can do "good", but late and at a high price. (Space-X has "good" and "cheap", but is about two years behind announced schedules. Their competition is even slower, so that's OK.)
Tesla looks like they're doing a good job of manufacturing, but their Fremont plant has 3,000 employees for 50,000 cars a year. That's 125 labor hours per car. They can't make a $35K price point with that. The big manufacturers are in the 15-30 hour range.[1] That's the big problem. Tesla needs to learn how to reach Toyota levels of production efficiency, and they have a long way to go.
Making 500,000 cars a year isn't in itself an obstacle. The Mercedes A-class production line cycles every 40 seconds. That's 720 cars per shift. If that line ran 2 8-hour shifts (you need a shift for maintenance) and 7 days a week, it could build over 500,000 cars in a year. That's just one production line.
It's getting that production line built, working, thoroughly debugged, and running at a low labor cost that takes some time. Tesla is going to need people who've done that before.
Tesla now faces transitioning from a low-volume high-margin manufacturer to a high-volume low-margin manufacturer. That's hard. HP, IBM, and Xerox tried that, and didn't do too well; all eventually exited the low end and downsized. Even Intel is exiting the low end; they're giving up on the tablet and phone market, as a YC article pointed out a few days ago.
Tesla is trying for good, fast, and cheap at the same time. Tesla's track record is that they can do "good", but late and at a high price. (Space-X has "good" and "cheap", but is about two years behind announced schedules. Their competition is even slower, so that's OK.)
Tesla looks like they're doing a good job of manufacturing, but their Fremont plant has 3,000 employees for 50,000 cars a year. That's 125 labor hours per car. They can't make a $35K price point with that. The big manufacturers are in the 15-30 hour range.[1] That's the big problem. Tesla needs to learn how to reach Toyota levels of production efficiency, and they have a long way to go.
Making 500,000 cars a year isn't in itself an obstacle. The Mercedes A-class production line cycles every 40 seconds. That's 720 cars per shift. If that line ran 2 8-hour shifts (you need a shift for maintenance) and 7 days a week, it could build over 500,000 cars in a year. That's just one production line.
It's getting that production line built, working, thoroughly debugged, and running at a low labor cost that takes some time. Tesla is going to need people who've done that before.
[1] http://www.autonews.com/assets/PDF/CA2018861.PDF