- Tesla has been struggling to build the Model 3.
- The company said in its third-quarter investor letter Wednesday that the biggest constraint has been an issue with an assembly line for battery production at Gigafactory 1, the company’s battery plant in Nevada.
- Because of the restraints, Tesla is pushing back its production timeline for the Model 3.
Tesla shared details about why it is struggling to build its first mass-market car, the Model 3, on Wednesday.
Production delays for the Model 3 stem from manufacturing related issues at Gigafactory 1, the company said in its third-quarter investor letter on Wednesday. Gigafactory 1 is Tesla’s giant battery plant located in Sparks, Nevada.
“To date, our primary production constraint has been in the battery module assembly line at Gigafactory 1, where cells are packaged into modules. Four modules are packaged into an aluminium case to form a Model 3 battery pack. The combined complexity of module design and its automated manufacturing process has taken this line longer to ramp than expected,” the company said in the letter.
The company said that it had to redesign a big chunk of the assembly line responsible for making battery modules at the Gigafactory and this has caused a bottleneck delaying production.
Tesla’s production issues became apparent after it reported only making 260 Model 3s in the third quarter. The company had aimed to make 1,500 Model 3s in September alone.
The company is now officially pushing back its production timeline for the Model 3.
Tesla had originally planned to produce about 5,000 Model 3 vehicles a week by December. But the company said in the letter that it now expects to hit that goal by the end of the first quarter.
“While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear,” the company said.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.