Tesla is throttling down Cybertruck production as it shifts workers to Model Y production because inventory of the electric pickup truck is piling up.
The automaker had planned a production capacity of 250,000 Cybertrucks per year at Gigafactory Texas, and CEO Elon Musk said he could see this being ramped up to 500,000 per year.
However, things are not going in that direction.
After having sold roughly 40,000 Cybertrucks in its first year of production (2024), Tesla is already throttling down Cybertruck production, according to documents obtained by Business Insider.
The report states that Tesla asked employees working on Cybertruck production to switch to Model Y production for “business needs”:
“As we continue to assess schedules to meet business needs, we’ll be making a change to Model Y and Cyber schedules and we want to ensure that your preferences are considered.”
The moves come as Tesla is facing mounting Cybertruck inventory and has started to directly discount them by $1,600 and even add “free supercharging for life” on some inventory:
Top comment by Aigars Mahinovs
2024 was basically the first year in Tesla history where they had far more manufacturing capacity than they had customers willing to buy their cars. Tesla was reporting current, actual manufacturing capability of roughly 3 million cars per year as early as Q1 2024. Selling just 1.8 million cars in the year 2024 after that is a major letdown and exposes the fact that Tesla manufacturing capability simply does not matter anymore. If Tesla made a million more cars (which it claimed to have the capacity to do), then they would be just sitting in parking lots, unsold. The price levers have all been pulled already, the profit margins are lower than Toyota. The demand for Tesla BEVs is on a decline while demand for non-Tesla BEVs is still healthy and growing. Those are simple and indisputable facts. What are the consequences of this going to be, that is open for discussion.
But making more Model Y cars is not going to help Tesla much.
Last month, we reported that Tesla went as far as buffing out “Foundations Series” badges on some Cybertrucks to sell them as regular cheaper ones and homologated US Cybertrucks for the Canadian market to try to move them.
With the release of its sales report for Q4 2024, Tesla showed that Cybertruck deliveries in Q4 are flat or even down compared to Q3 despite having launched cheaper versions of the vehicle during the quarter.
The move of workers from Cybertruck to Model Y also comes as Tesla is preparing to build a new version of the Model Y at Gigafactory Texas after launching it in China.
However, Tesla usually doesn’t launch a new production at the detriment of another vehicle program, but this time, it is convenient because of the Cybertruck’s demand issues.
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