Turbulent times are continuing for Tesla as an influential US consumer publication declines to recommend its Model 3 car.
The Tesla Model 3 has taken a knock as respected US magazine Consumer Reports failed to recommend the car.
The publication provides a yearly rating of vehicles for sale in the US and, although it did find numerous positives about the Model 3, it said the car had “big flaws”, which caused it to stumble in securing a recommendation. The magazine flagged some issues with the vehicle, reporting overly long stopping distances and adding that the touchscreen was difficult to use.
Stopping distance is a problem
Consumer Reports said that the Model 3’s stopping distance of 46 metres was much worse than any other modern car tested, and was longer than that of a Ford pickup truck. Tesla had said its own testing found a stopping distance of approximately 40 metres on average using the 18in Michelin all-season tyre. The company also said that software updates to the vehicle would, over time, improve factors such as stopping distance.
CEO Elon Musk recently announced plans for a dual-motor, all-wheel drive version of the Model 3, including a top-level variant that would be more expensive than the Model S or X. Sales of the more expensive version of the Model 3 are crucial at this juncture, as the company continues to spend more money. The first dual-motor Model 3s will be delivered in July, according to Musk.
Changes in production strategy
The Model 3 was pegged to start at $35,000, making it the most affordable Tesla model, but this changed as production got underway. According to The Verge, the starting price for the Model 3 currently available is $49,000, which will jump again once the all-wheel drive option is available.
The bare-bones $35,000 Model 3 was a major talking point for Musk, touted as a mass-market and affordable option. These models look unlikely to ship until three to six months after Tesla starts making 5,000 units of the Model 3 weekly, and the company hopes to be doing so in July.
With production, 1st you need achieve target rate & then smooth out flow to achieve target cost. Shipping min cost Model 3 right away wd cause Tesla to lose money & die. Need 3 to 6 months after 5k/wk to ship $35k Tesla & live.
— Elon Musk (@elonmusk) May 21, 2018
While Tesla is currently losing money with every Model 3 it ships, it makes financial sense for the company to focus on more expensive models – although not all of its customers will be pleased with this change of tack.
The company is currently in a bit of a cash bind, with Musk recently asking staff to look for ways to save time and money, from cutting unnecessary meetings to reorganisation of personnel. Some analysts think the company needs to raise cash – and fast – for it to meet Musk’s lofty performance targets.