Tesla Aims to Double Model S Production, Maybe Add Driver-Assist Features

By · August 09, 2013

Tesla Model S

Tesla Motors on Wednesday announced Q2 2013 financial results that showed increased sales and revenues. But the big story, arguably, is that Tesla is rapidly building up its capabilities as an auto manufacturer—in a slow and steady path toward developing a full line of electric cars. In Wednesday's analyst conference call, Tesla CEO Elon Musk said
production increased from about 400 cars a week, to nearly 500 cars. By the end of 2014, Tesla expects to be able to manufacture as many as 40,000 Model S units per year.

Musk described Tesla’s progress with fixing mistakes in the manufacturing process, including eliminating parts from suppliers that can’t ramp up production. About 1 percent of its suppliers are unable to increase production, which in turn limits Model S production. Engineers are working to redesign the Model S to replace these parts and to work with manufacturers with better capabilities.

According to Tesla, North America Model S demand is about 20,000 cars a year. European demand should be similar, and Tesla plans to set up distribution in China and Japan. In a letter to shareholders, Tesla said it’s planning $150 million in Q3/Q4 2013 capital expenditures—partly to "invest in additional production capacity" and also to purchase land next to its California factory.

Model X on the Way

Tesla Model X, with falcon-wing doors.

The company's medium term focus is on the Model X. Musk said the management team would be shifting priorities this quarter to work on the all-electric SUV. The company plans limited production of the Model X in late 2014, with full-scale production beginning in 2015. Shifting focus to the Model X doesn't mean the S design is frozen. The company still needs to develop a version for China, and a right-hand drive version for Japan.

Tesla engineers and designers are working now to make the Model X better than the "demonstration prototype" vehicle unveiled to the public. Details about those improvements were not revealed.

Tesla also continues to work on its so-called Gen3 car, a more affordable electric model. From Tesla's perspective, "affordable" means a sticker price similar to a BMW 3-series. Musk expressed a high degree of confidence in being able to produce a compelling 200-mile range Gen3 car in the $35,000 price range (before incentives). "There's a huge amount of work, but no miracles required," said Musk.

Yet, Musk discussed the impact of the Gen3 car on global manufacturing capacity for lithium cell production. Producing a few hundred thousand electric cars per year with the 60-kWh packs could exceed global production capacity of the 18650 cells used in Tesla cars. According to Musk, new cell factories will be required, if Tesla succeeds with a high volume electric car.

Radar Expert Needed

Meanwhile, Tesla's online list of job openings now includes this one: "Hardware Engineer – Radar." The job details jive with a theory that Tesla is exploring driver assistance or even autonomous driving features. Competing carmakers have camera and radar systems that detect surrounding traffic, lanes and pedestrians—giving appropriate warnings to the driver to avoid collisions. Some systems include parking-assist features for safe parallel parking, and cameras that can look around corners.

The job opening seeks someone to develop active safety systems using RADAR, LIDAR, ultrasound and cameras. The engineer “will be responsible for translating Tesla's autopilot roadmap into active safety features and into requirements.” The expertise it’s seeking includes RADAR sensing and development, antenna systems, algorithms for sensor signal processing and more. The engineer must have experience developing a RADAR system from scratch.

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