Tesla Took a Shortcut and It Backfired
Brooke Crothers over at Forbes had an interesting take on skipping the Tesla Model 3 in favor of the Chevy Bolt and I couldn’t agree with him more.
And the beauty of the Bolt -- relative to the Model 3 -- is that you can walk on to many Chevy dealer lots across the country and drive one home the same day. You're not put on a 1-year (or worse) waiting list and it's not a guessing game whether Tesla solves its high-volume production bottlenecks or whether your car arrives by its delivery date.
Let me insert here that some readers will always say, "you can't compare the Bolt with a Tesla!" or "My God, it's a Chevy!" Wrong, on both accounts, in my opinion. We weighed waiting for the Model 3 but that notion was immediately dismissed when we test drove a Bolt. So, yes, we were looking at both the Model 3 and Bolt. And, yes, the Bolt is that good.—Brooke Crothers, Forbes
In my book, The Tesla Bubble, I predicted that Tesla was going to run into major problems with the Model 3 and it wasn’t a very difficult prediction to make. The whole automotive world was aghast when Elon Musk announced that they were going to skip the all-important step of designing their “master line”. A young company with a spotty quality record like Tesla doing this is somewhat akin to a middle school quarterback announcing that he was ready for the NFL draft.
Here is an excerpt from my book.
Even I, with my low expectations of Tesla, was surprised recently to see the headlines that Tesla had decided to skip the step of fine tuning their Model 3 production master line. Why? Because they were behind schedule. So Elon Musk has decided to skimp on quality to make up the difference. This is why Tesla will eventually run into quality problems en masse with their Model 3. Tesla’s problems ultimately flow down from the top.
But the problem is that Tesla can’t skip dealing with the inevitable manufacturing issues. They still need to fine tune their manufacturing processes. They’ll be forced to learn as they go while they produce actual products destined to ship to customers. Even if you’re a Tesla fan who wants a Model 3, you definitely don’t want one produced in year 1. The old adage of “never buy a new car in its first year of production” will never be more true than it is for Tesla’s Model 3.
When a world class automaker irons out the kinks in a new model, these products built on their prototype line are charged to R&D. Tesla is going to charge the customer.
Tesla has weakly pointed out that Audi has skipped the golden line step and had some success with it. But Audi is a world class manufacturer and Tesla is not. And no one else in the auto industry has dared to follow Audi’s example. Further, Tesla's claim that they didn't get much from their previous master line can't be taken seriously. That's like saying that we don't need a Department of Homeland Defense because there haven't been any terrorist attacks lately. It is hard to quantify all the issues that you prevented by doing the master line. Elon Musk is simply trying to placate investor fears by making that statement.
Tesla will forge ahead with setting up all their lines before ironing out all their manufacturing issues. If the lines need to be re-configured or various pieces of machinery need to be swapped out, it’ll have to be done at a large scale. This will mean longer delays and much higher costs than if they had just done things right from the beginning.
To people familiar with high-volume manufacturing, the fact that Tesla is way behind schedule is to be expected considering the “short cut” that they took. And these cars are going to be a nightmare from a quality standpoint.
I’d bet my annual salary that the Chevy Bolt will be a much higher quality car than the Tesla Model 3 in every way. Chevrolet came out of the 80’s a leaner meaner manufacturing entity that knows how to produce millions of units with a low rate of defects. If you really want a reliable EV I’d not advise cross-shopping the Bolt…I’d advise starting with the Bolt. Plus, Chevrolet will be around in five years to service your car. Tesla? Not so much.
Now available in iBooks —> The Tesla Bubble
Let me insert here that some readers will always say, "you can't compare the Bolt with a Tesla!" or "My God, it's a Chevy!" Wrong, on both accounts, in my opinion. We weighed waiting for the Model 3 but that notion was immediately dismissed when we test drove a Bolt. So, yes, we were looking at both the Model 3 and Bolt. And, yes, the Bolt is that good.—Brooke Crothers, Forbes
In my book, The Tesla Bubble, I predicted that Tesla was going to run into major problems with the Model 3 and it wasn’t a very difficult prediction to make. The whole automotive world was aghast when Elon Musk announced that they were going to skip the all-important step of designing their “master line”. A young company with a spotty quality record like Tesla doing this is somewhat akin to a middle school quarterback announcing that he was ready for the NFL draft.
Here is an excerpt from my book.
Even I, with my low expectations of Tesla, was surprised recently to see the headlines that Tesla had decided to skip the step of fine tuning their Model 3 production master line. Why? Because they were behind schedule. So Elon Musk has decided to skimp on quality to make up the difference. This is why Tesla will eventually run into quality problems en masse with their Model 3. Tesla’s problems ultimately flow down from the top.
But the problem is that Tesla can’t skip dealing with the inevitable manufacturing issues. They still need to fine tune their manufacturing processes. They’ll be forced to learn as they go while they produce actual products destined to ship to customers. Even if you’re a Tesla fan who wants a Model 3, you definitely don’t want one produced in year 1. The old adage of “never buy a new car in its first year of production” will never be more true than it is for Tesla’s Model 3.
When a world class automaker irons out the kinks in a new model, these products built on their prototype line are charged to R&D. Tesla is going to charge the customer.
Tesla has weakly pointed out that Audi has skipped the golden line step and had some success with it. But Audi is a world class manufacturer and Tesla is not. And no one else in the auto industry has dared to follow Audi’s example. Further, Tesla's claim that they didn't get much from their previous master line can't be taken seriously. That's like saying that we don't need a Department of Homeland Defense because there haven't been any terrorist attacks lately. It is hard to quantify all the issues that you prevented by doing the master line. Elon Musk is simply trying to placate investor fears by making that statement.
Tesla will forge ahead with setting up all their lines before ironing out all their manufacturing issues. If the lines need to be re-configured or various pieces of machinery need to be swapped out, it’ll have to be done at a large scale. This will mean longer delays and much higher costs than if they had just done things right from the beginning.
To people familiar with high-volume manufacturing, the fact that Tesla is way behind schedule is to be expected considering the “short cut” that they took. And these cars are going to be a nightmare from a quality standpoint.
I’d bet my annual salary that the Chevy Bolt will be a much higher quality car than the Tesla Model 3 in every way. Chevrolet came out of the 80’s a leaner meaner manufacturing entity that knows how to produce millions of units with a low rate of defects. If you really want a reliable EV I’d not advise cross-shopping the Bolt…I’d advise starting with the Bolt. Plus, Chevrolet will be around in five years to service your car. Tesla? Not so much.
Now available in iBooks —> The Tesla Bubble
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