After Tesla’s China factory was forced to halt production due to the ongoing chip shortage last month, an internal email from CEO Elon Musk shows that the company’s Q3 end-of-quarter delivery wave will be much higher than usual due to parts shortages.
Tesla is aiming to “ensure a decent Q3 delivery number,” despite a larger-than-normal end-of-quarter delivery push resulting from the ongoing chip shortage, according to an internal email shared by electrek.
In the email, Musk explains that shortages from earlier in the quarter will affect this quarter’s delivery wave, also explaining that the process of production required added flexibility because of the circumstances.
Musk also noted that Tesla is “dying to reduce the size of the end-of-the-quarter delivery wave,” with the company planning to do so as soon as Q4.
In addition to Tesla, GM has announced it is halting production at most of its factories for 1-2 weeks because of the shortages. China-based EV makers including NIO, Xpeng and Li Auto have also seen slowed sales numbers due to the shortage since May – at the least.
In July, after months of the shortage had already unfolded, Musk said the shortage “remained quite serious,” and being that it’s already September and they still aren’t out of the woods, it’s tough to say when the shortage will lighten up.
You can read Musk’s full email to Tesla employees below.
The end of the quarter delivery wave is unusually high this time as we suffered (like the rest of the industry) from extremely severe parts shortages earlier this quarter. This meant building a lot of cars with missing parts that needed to be added later. I’d like to thank all Tesla techs and contractors that helped add back the missing parts, often in very difficult conditions. You rock!
And we are for sure dying to reduce the size of the end-of-the-quarter delivery wave! The goal is to do so in Q4 (allowing some Q4 production to spill over to delivery in Q1). However, early Q3 production was so challenging that we need to go super hardcore to make up for it over the next ~22 days to ensure a decent Q3 delivery number. This is the biggest wave in Tesla history, but we got to get it done.
Much appreciated,
Elon
