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Financial Times / Biz - Money

Tesla delivers a clunker with latest Model 3 figures

Tesla delivered only 1,550 of its new Model 3 vehicles in the final quarter of last year, well below the 5,200 consensus forecast of Wall Street analysts, as it struggled to overcome the production bottlenecks that have bedeviled its make-or-break mass market car.

The US electric carmaker also pushed back its target for hitting a production rate of 5,000 a week of the new cars to the end of the second quarter, three months later than it had projected. The delay comes only two months after it last pushed back the 5,000-a-week target by a full quarter.

The latest signs of Tesla’s production headaches with the Model 3 wiped nearly 2 per cent off its shares in after-market trading on Wednesday, leaving them 20 per cent below their peak of last summer.

However, the company said it had made “major progress addressing Model 3 production bottlenecks”, with output picking up late in December. Production during the quarter reached 2,500 vehicles, many of them too late to be delivered before the end of the year, the company said.

The first Model 3s, priced from $35,000, rolled off the production lines in July, though Tesla had delivered only 220 of them by the end of September. At the time, it blamed its teething problems on mastering the complexity of a production line in the Nevada plant where lithium ion cells are packaged together into modules, before being assembled into final battery packs.