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OM in the News: Tesla’s Changing Assembly Line

July 9, 2018

The Model 3’s third assembly line, under a tent.

Just outside Tesla’s sprawling electric-car Fremont, Calif. plant, an unusual structure has taken shape in the past few weeks: a tent, about 50 feet high and several hundred feet long. Its purpose is as notable as its hasty construction, writes The New York Times (July 1, 2018). The tent houses a 3rd assembly line — part of a desperate effort to speed up production of the Model 3. Just 2 years ago, Tesla envisioned 2018 as a breakthrough moment.  With a high-speed, high-tech assembly process, the company’s sales would soar more than fivefold, to half a million vehicles. It hasn’t turned out that way. As CEO Elon Musk said: “the company faced a prolonged period of manufacturing hell.”

Tesla has raced to iron out kinks in the assembly process, mainly by scrapping some complicated robots that proved ill-suited to certain tasks and hiring hundreds of workers to replace them. On the factory floor, it’s a frantic race that has taken a toll on some employees. Trying to break with standard auto-industry practices, Tesla is searching for ways to shorten the time that robots take to weld parts. It is even making seats, a component most car companies leave to specialized suppliers. And it is doing this while trying to root out bottlenecks and glitches in the manufacturing process.

Established car companies master the process with assembly-line workers and then find ways for machines to take over some of the work. Tesla did the opposite. It designed a highly automated production line populated by over 1,000 robots. But the most efficient lines use a lot of manual labor. “The most automated ones are at the bottom of the list,” said one industry expert.

Adding a new assembly line, even temporarily, is a rare and risky move in the auto industry. A line set up hastily, in an untested environment, might not achieve the quality Tesla promises. The first step in auto quality is stability.

Classroom discussion questions:

  1. What do you think is the impact on the workers on the Model 3 lines?
  2. What did Tesla do wrong?


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