Electric automaker Tesla Inc has again fallen short of production goals for its new Model 3 sedan.
The California-based company made 2,425 Model 3s in the fourth quarter. That is only a fraction of the 20,000 per month that chief executive officer Elon Musk promised last summer when the car first went into production.
The company exceeded its overall sales targets, delivering 101,312 Model S sedans and Model X SUVs last year, up 33 percent over 2016.
However, all eyes are on the Model 3, which is Tesla’s first lower-cost, high-volume car and is crucial to its goal of becoming a profitable, mainstream automaker. Tesla at one point had more than 500,000 potential buyers on the waiting list for the Model 3.
The company in a statement on Wednesday thanked those buyers “who continue to stick by us while patiently waiting for their cars.”
Tesla made significant progress in reducing unspecified production bottlenecks toward the end of the fourth quarter, it said.
The company now expects to be making 10,000 Model 3s per month at the end of the first quarter and 20,000 Model 3s per month at the end of the second quarter, it said, adding however that it is focusing on quality and plant efficiency, not just meeting volume targets.
Tesla would have been better served by not announcing such lofty production targets initially, Autotrader.com executive analyst Michelle Krebs said.
“The Model 3 must be right in terms of quality. Ramping up production levels with a flawed product is foolish,” she said.
Tesla shares on Wednesday fell 2 percent to US$310.50 in after-hours trading.
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