Tesla deliveries rise in third quarter, but Model 3 faces 'bottlenecks'

Last Updated: Tue, Oct 03, 2017 11:53 hrs
A Tesla Model S vehicle is displayed at the Tesla store in Sydney, Australia

Luxury electric vehicle maker Tesla Inc said on Monday its deliveries rose 4.5 percent in the third quarter from the prior-year period, but said "production bottlenecks" had left the company behind its planned ramp-up for the new Model 3 mass-market sedan.

Tesla said it delivered 26,150 vehicles in the third quarter, including 14,065 Model S vehicles and 11,865 Model X cars, up 17.7 percent from the second quarter of this year.

The Palo Alto, California-based company delivered just 220 Model 3 sedans and produced 260 during the quarter. In July, it began production of the Model 3, which starts at $35,000 - half the starting price of the Model S.



Tesla had said in its second-quarter financial report that it expects "to achieve a rate of 5,000 Model 3 vehicles per week by the end of 2017." The automaker also said it expects at some point in 2018 to further ramp to a rate of "10,000 Model 3 vehicles per week," and an annual production rate in excess of 500,000 vehicles.

"It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain," Tesla said in a statement. "We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near term."

Tesla said it was on track to deliver around 100,000 S and X models this year.

But Tesla said on Monday that a handful of systems at its Fremont, California, car plant and its battery factory in Reno, Nevada, "have taken longer to activate than expected."

The automaker said 4,820 Model S and X vehicles were in transit to customers at the end of the third quarter and would be counted with its fourth-quarter figures.

In after-market trading, Tesla shares fell more than 1 percent to $337.84, from the closing price on Nasdaq of $341.53.

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