Jan 4, 2018

Tesla struggles to break out of Model 3's "production hell"

Photo: Tesla via AP

It's kind of a glass half-empty or half-full question right now when it comes to Tesla's mass-market Model 3 electric sedan. As we reported in the Axios stream yesterday, the Silicon Valley automaker reported a jump in Model 3 production in the fourth quarter, producing 2,425 of the mainstream priced cars compared to a paltry 260 in the prior quarter.

Why it matters: Tesla's ability to address what CEO Elon Musk has called "production hell" and churn out the Model 3 at scale is vital for the company's future in the increasingly competitive EV market.

Yes, but: Tesla has once again delayed its target of producing 5,000-per-week, and the new timeline is to reach that level at the end of the second quarter of this year. Wall Street was not impressed — the stock fell by almost 3% in after-hours trading.

Case in point: Quartz contrasts Tesla's Model 3 production with GM's electric Chevy Bolt:"GM launched the car in 2015, far ahead of the $35,000 Model 3, Tesla's first mass-market vehicle, and it seemed like no contest at the time. Tesla had amassed an impressive 400,000-person or so waiting list, and no one was lining up to buy GM's comparatively dowdy car months before it rolled off assembly lines. Today, monthly sales keep climbing, and it has reported 22,662 in sales since its debut in Dec. 2016."Quick take: Tesla's quarterly announcement was exceedingly earnest and humble in tone. Musk seems to understand that he over-promised and that he needs to be ultra-cautious in what he says now.The big picture: The Los Angeles Times has an in-depth look at the status of the EV and solar power company, and its ability to keep raising money from investors.

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The novel coronavirus has spread from China to infect people in more than 40 countries and territories around the world, killing over 2,700 people.

The big picture: Most of the 80,000 COVID-19 infections have occurred in mainland China. But cases are starting to surge elsewhere. By Wednesday morning, the worst affected countries outside China were South Korea (1,146), where a U.S. soldier tested positive to the virus, Italy (332), Japan (170), Iran (95) and Singapore (91). Just Tuesday, new cases were confirmed in Switzerland, Croatia and Algeria.

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Sen. Bernie Sanders wanted to keep his momentum after winning contests in New Hampshire and Nevada, while former Vice President Joe Biden hoped to keep his own campaign alive. The other five candidates were just trying to hang on.

What's happening: Seven contenders for the Democratic presidential nomination were in Charleston, South Carolina, for the tenth debate, just days before the South Carolina primary and a week before Super Tuesday. They spoke, sometimes over each other, about health care, Russian interference in the election, foreign policy the economy, gun control, marijuana, education, and race.

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4 takeaways from the South Carolina debate

Former Vice President Joe Biden, right, makes a point during Tuesday's Democratic presidential debate, while Vermont Sen. Bernie Sanders listens. Photo: Win McNamee/Getty Images

The 10th Democratic debate was billed as the most consequential of the primary thus far, but Tuesday night's high-stakes affair was at times awkward and unfocused as moderators struggled to rein in candidates desperate to make one last splash before Saturday's primary in South Carolina and Super Tuesday.

The big picture: After cementing himself as the Democratic favorite with a sweeping win in Nevada, Sen. Bernie Sanders came under fire as the front-runner for the first time on the debate stage. Former New York Mayor Michael Bloomberg, who will be on the ballot for the first time next Tuesday, was a progressive foil once again, but he appeared more prepared after taking a drubbing at the Nevada debate.