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Tesla says labor hours have decreased by 30% on Model 3 production, reportedly had to ‘rework’ most cars in record week

A report is throwing some cold water on Tesla’s achievement of 5,000 Model 3’s in a single week in June by claiming that the automaker had to “rework” most of those vehicles.

However, Tesla says that most of the “rework” is minor and that labor hours have decreased by 30% on Model 3 production over the last quarter.

After the last quarter, Tesla announced that it reached its goal to produce 5,000 Model 3 vehicles in a week at the end of June.

The achievement has been questioned quite a bit in the press to the consternation of Tesla leadership.

In the latest challenge to the goal, Business Insider claims that it obtained proof that Tesla had to rework the vast majority of those cars:

“Internal documents show that Tesla had to rework more than 4,300 of the 5,000 Model 3 vehicles it built during the last week of June when it hit its critical production target.”

It put Tesla’s Model 3 first pass yield at about 14% for that week against a general industry target of about 80%.

The report claims that the average rework per car took 37 minutes.

Without specifying what the rework involved, Tesla said that most issues are small and the Model 3’s don’t have significant problems when they come off the assembly line.

The automaker didn’t want to confirm its first pass yield, but it claimed that labor hours have decreased by 30% on Model 3 production over the last quarter.

A spokesperson said in a statement:

“Our goal is to produce a perfect car for every customer. In order to ensure the highest quality, we review every vehicle for even the smallest refinement before it leaves the factory. Dedicated inspection teams track every car throughout every shop in the assembly line and every vehicle is then subjected to an additional quality control process towards the end of line. And all of this happens before a vehicle leaves the factory and is delivered to a customer. Notably, Tesla has the highest customer satisfaction level in the entire global auto industry, and relative to every other car company in the world, Tesla has the most customers who say their next car will be a Tesla. That is the true test of customer happiness. We’ve also seen huge improvements on Model 3 quality. Our customer satisfaction scores for Model 3 quality have averaged about 90% since January, with steady improvement through the year, even as the number of cars delivered has rapidly multiplied. And our factory efficiency has also improved, with the number of labor hours per Model 3 produced declining by nearly 30% since last quarter. Finally, a customer never has to worry because if they are unhappy with their car when they receive it, they can either give it back for a full refund, allow us to address any issues, or ask for an entirely new car.”

Electrek’s Take

This will likely be blown out of proportion, but I think it actually shows progress.

As I have discussed in the past, while Tesla has been criticized for those bursts of production to “show good numbers” and then not being able to maintain it, I think it is useful for Tesla to improve production.

Those bursts are good to show weaknesses in the production process in order to fix them.

Obviously, that happened during the last week of June when Tesla achieved 5,000 Model 3’s in a week for the first time.

Now they have been able to resolve some of those issues, which led to the improvement in labor hours per car over the last two months.

What do you think? Let us know in the comment section below.

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