Blog Tesla is Building Car Carriers to Keep Up With Model 3 Deliveries

Tesla is in a sprint to deliver as many cars as possible ahead of the end of the third quarter. Chief Executive Elon Musk has called it “delivery logistics hell.”

In fact, Tesla is delivering so many cars that it’s having trouble finding car carriers. So, the company has started manufacturing their own trailers. Musk shared that tidbit in a tweet today.

https://twitter.com/x/status/1044294753041313792

Tesla has struggled with production bottlenecks since the Model 3 sedan was introduced, but is now reportedly churning out around 4,000 of those cars every week. The ramp in production is now creating a bottleneck in delivery.

TMC members and Tesla watchers have observed large lots packed with Model 3s, as well as trucks pulling full loads of Model 3s en route to new owners. Tesla is aiming to produce around 50,000 Model 3s in the third quarter.

Musk did not provide more details about the car carriers built by Tesla, but it’s interesting to see the company work out a solution when it’s up against a tough challenge. Musk has also tried to remove some pressure from Tesla’s delivery team by inviting existing Tesla owners to help “educate” new owners taking delivery.

Has anyone spotted a Tesla-built car carrier?

 

[Xenius]

And what impact, pray tell

"That's the way it's always been done" is not the best response.

It's not even a good response, it's lazy and backward thinking.

 

[Knightshade]

Facts do matter, Tesla makes more cars than the 3.

Tesla: 23,175 (S+X+3)
Higher than Audi and Mercedes

And lower than BMW.

So the idea they are "eating BMWS lunch" is complete nonsense.

And since Audi and Mercedes sold all those cars while turning a profit, they're not really having their lunch eaten either.



What's funny is- Tesla would stand a lot better chance of genuinely eating their lunch if they actually had enough infrastructure to deliver all the cars they build in a timely fashion

 

[ItsNotAboutTheMoney]

If it's ALREADY led them to the best way of doing things, why is Tesla eating BMW's lunch? Why are we still burning our resources in order to move from point A to point B?

It's hard to tell. BMW changed its diet. Sales are still up, though fairly flat.

There are other premium makes that are down (notably Lexus and Mercedes-Benz), and maybe Tesla's been stealing some off their plate.

If/when Tesla releases the Model Y, _then_ they might start eating others' lunch.

The market is going premium in general.

 

[mongo]

Maybe I'm misunderstanding you here, but no they can't. A car carrier trailer (and the tractor that tows it) are quite specifically built for the duty and no amount of "converting" will turn a non-car carrier into one.

Trailers of all types carry 17 digit VINs just like all other on road vehicles do, and in this case I might think the NHTSA would even require a new WMI for Tesla tractor trailers. It's an involved process and if they did in fact start building them this weekend, the groundwork was laid months ago.

So my question was not flippant but genuine, is there any truth to what Elon has said?

Dual stack covered carriers are standard fifth wheel.
Beyond the cab with a single carrier above, there are many open frame fifth wheel type also.

NHTSA requirements for trailers are pretty minimal (and I'm not sure if they apply to ones not for sale, I'd expect so by the wording is vague). Yes, they need a VIN (which defines Type of trailer, body type, length and axle configuration) and loading placard along with lights and brakes, but if you consider the car support structure to be part of the cargo, it opens up some options.

 

[crmatson]

BMW sales up 2.3% year-to-date.

Tesla sales are up about 120%.

120% > 2%

 

[lklundin]

if only someone at Tesla had known in advance they'd eventually need to transport a lot of cars or something.

Yes, now that the delivery problems have become obvious, it is easy to poke fun.

But Tesla's plan for the Model 3 ramp up was "as fast as possible".

It is easy to forget now where the machine that builds the machine is up to a reasonable speed, but the ramp up
is an order of magnitude in less than a year - with considerable improvisation along the way (such as constructing
an assembly line in a tent) leading to considerable uncertainty on exactly when 10 times as many trucks would be
needed. Ordering the necessary carrier capacity six months too early could have caused a significant loss.

Also, people who have actual experience with scaling processes involving tangible objects will let you know that
even when planning carefully ahead, something unforeseen will become a bottleneck. And per definition, unless
every little step in the entire process is running at exactly the same speed, one step somewhere will be a bottleneck.

As they say in the Army (which is all about logistics): "Why is it always the last one we have to wait for?"

So laugh if you will, but don't be sure others could do better.

 

[Knightshade]

BMW sales up 2.3% year-to-date.

Tesla sales are up about 120%.

120% > 2%

This are the nonsense numbers new business lines always use in their marketing.

Because they're starting from virtually zero even a few sales is a 100% INCREASE!

 

[mongo]

Not sure how it's any more valid than pointing out 17.46->17.13 million means over 300,000 cars excess capacity at a minimum.

Just getting us on the same page (your numbers, not mine)

This makes some unfounded assumptions. Including that 17.46 million was 100% capacity in the first place and the system had 0 slack even then.

That's even more assumptions... Some have longer routes... some shorter...but let's see where this gets us...

Which is more than Tesla needed by a wide margin.

Reread:

At 250 days a year it's 8,730 carriers, 1.9% is 166 carriers free. Say only 30 state have Tesla centers, that is 5.5 carriers per state total capacity of 44 cars. Tesla is pumping out upwards of 100 a day in some locations.

That'd be great if they weren't hemorrhaging money elsewhere.

Say what now?

Not to mention they don't get to recognize that 10k gross margin until they DELIVER THE CAR.

And your point would be? There is no last mile charge until they deliver it either...

And lower than BMW.

Did you even read the post?

Which, when combined, give them MUCH higher sales than all teslas models combined.

614 or 2.6% less than BMW, you have a low threshold for much higher.

 

[Knightshade]

Yes, now that the delivery problems have become obvious, it is easy to poke fun.

But Tesla's plan for the Model 3 ramp up was "as fast as possible".

Again, the factory numbers they're almost hitting now are the ones Elon told employees almost 6 months ago he wanted to be hitting now.

Literally nobody should be "surprised" they have this many cars to delivery at this point. Yet they appear utterly unequipped to do so.

It is easy to forget now where the machine that builds the machine is up to a reasonable speed, but the ramp up
is an order of magnitude in less than a year - with considerable improvisation along the way (such as constructing
an assembly line in a tent) leading to considerable uncertainty on exactly when 10 times as many trucks would be
needed. Ordering the necessary fleet capacity six months too early could have caused a significant loss.

But again- we're almost exactly where they thought they'd be 6 months ago. If anything we're slightly UNDER those targets, and they don't have anywhere near the capacity they need available.


Did they think Elon was lying 6 months ago?

Was Tesla lying on their public investor statements 6 months ago?

If not, then they knew this was coming and didn't do anything to prepare for it.

 

[mongo]

But again- we're almost exactly where they thought they'd be 6 months ago. If anything we're slightly UNDER those targets, and they don't have anywhere near the capacity they need available.


Did they think Elon was lying 6 months ago?

Was Tesla lying on their public investor statements 6 months ago?

If not, then they knew this was coming and didn't do anything to prepare for it.

How do you suggest Tesla should have interacted with the carriers to both create the capacity needed and not add on fruitless debt?

The only other option I see is that Tesla signs up for committed capacity ahead of time allowing the carrier to expand/ shift resources, and Tesla pays for empty carriers and gets locked into a long term contract.

 

[lklundin]

Tesla's doing what now? BMW has sold 199,000 cars in the US through August. Tesla delivered 63,000 during that time.

Truth is hard.

Yes, it is.

And the truth is that Tesla is outgrowing everyone.
So instead of quoting YTD numbers, you need to only look at August.
Then you will see.
Or even better, wait one week for the September numbers to come out.

NB: Other posters on this forum, please consider ignoring this poster who reposts old arguments causing sensible people to waste time that could be wasted on something nice. I am about ready myself.

 

[lklundin]

Did they think Elon was lying 6 months ago?

Please. It is only lying if done in bad faith.

The man has repeatedly set near-impossible deadlines for himself and his companies, as a strategy for achieving more.

That is not lying, that is being ambitious.

 

[mattjs33]

https://cleantechnica.com/files/2018/09/August-Tesla-Mode-3-Sales-USA.png

That's an interesting number on the Model 3, I wonder where it comes from. As Tesla only reports quarterly, all monthly figures are estimates. Interesting to note, Automotive News estimates the Model 3 at 4000 for August. Likely the truth is somewhere in between.

Will be interesting to see the Q3 numbers.

 

[mongo]

That's an interesting number on the Model 3, I wonder where it comes from. As Tesla only reports quarterly, all monthly figures are estimates. Interesting to note, Automotive News estimates the Model 3 at 4000 for August. Likely the truth is somewhere in between.

Will be interesting to see the Q3 numbers.

Monthly Plug-In Sales Scorecard

 

[mattjs33]

Dual stack covered carriers are standard fifth wheel.
Beyond the cab with a single carrier above, there are many open frame fifth wheel type also.

NHTSA requirements for trailers are pretty minimal (and I'm not sure if they apply to ones not for sale, I'd expect so by the wording is vague). Yes, they need a VIN (which defines Type of trailer, body type, length and axle configuration) and loading placard along with lights and brakes, but if you consider the car support structure to be part of the cargo, it opens up some options.

Doesn't matter if they are for sale or not. The trailer needs to be registered, so it needs to have a VIN. Yes they are standard fifth wheel but you cannot convert an existing trailer, you've seen them, you know why.

NHTSA requires VIN decoding info submitted like 60 days or whatever before the first vehicle is sold. As of now, there is nothing submitted by Tesla for car carrier trailers.

Honestly I seriously doubt Tesla is building their own car carriers today, where would they build them? I think it's more nonsense from Elon, similar to "body repairs in an hour". I don't mind being proven wrong but there's no evidence to support this happening.

 

[mattjs33]

Monthly Plug-In Sales Scorecard

I'm familiar with that site. They're still estimates. I'm not saying you're wrong, but there's a substantial variance in the different estimates so at least one of them is suspect. It's impossible to say when reporting quarterly but interesting to note that GM went to quarterly reporting this summer.

 

[Knightshade]

Yes, it is.

And the truth is that Tesla is outgrowing everyone.

Which is easy to do when you start from basically 0.

So instead of quoting YTD numbers, you need to only look at August.
Then you will see.

I did. I see Tesla sold less total vehicles than BMW. So they're not really "eating their lunch" are they?

Plus of course BMW also owns Mini and RR, you'd need to count their sales too.

Which is why Audi, owned by VW, isn't even close to being behind Tesla in total sales either.


Tesla is without question doing well in specific segments of the market- including taking sales from other brands.

But in total vehicle sales they remain a very very tiny blip on the radar compared to the major players.

And that can't change until they vastly increase production capacity (and they add at least the Y and the pickup truck).

And the more sales Tesla does rack up the worse the actual problem this thread is about gets because they lack the ability to deliver those increasing sales numbers to customers.

NB: Other posters on this forum, please consider ignoring this poster who reposts old arguments causing sensible people to waste time that could be wasted on something nice. I am about ready myself.

Yeah- "old" arguments like how facts work. LOL as the kids say.

 

[lklundin]

Was Tesla lying on their public investor statements 6 months ago?

If not, then they knew this was coming and didn't do anything to prepare for it.

You are in the wrong place for assuming that Tesla would lie in statements that fall under SEC's purview.

And you cannot assume that Tesla did not do anything to prepare for the increase in deliveries.

*Plonk*

 

[mattjs33]

NB: Other posters on this forum, please consider ignoring this poster who reposts old arguments causing sensible people to waste time that could be wasted on something nice. I am about ready myself.

Been here longer than you, champ. Sorry if you hear things from me that you don't like. If you make a compelling counterargument then stand behind it. You'll find I can be reasonable. But if it's easier for you to retreat to your safe place, then whatever. Not my problem.

 

[Knightshade]

How do you suggest Tesla should have interacted with the carriers to both create the capacity needed and not add on fruitless debt?

By arranging enough logistical capacity to meet the production targets their own CEO forcast they would be outputting.

You know- like literally every other company in the world, not just car companies, does in order to insure their products can move through their distribution channels to customers.

And again this logistics failure isn't just car carriers.

They don't have enough delivery centers in general for the # of cars.

They don't have enough space at the DCs they DO have for the # of cars.

They don't have anywhere near the # of staff they need at the DCs (or the SCs...or acting as IDAs....or handling trade ins...etc) for the # of cars.


It's not just "one" bottleneck they missed. It's literally every step of the process once the car is built until it gets to the customer to handle the # of cars they've been telling the world for a while now they intend to make.

H
The only other option I see is that Tesla signs up for committed capacity ahead of time allowing the carrier to expand/ shift resources, and Tesla pays for empty carriers and gets locked into a long term contract.

Based on us knowing there's enough excess capacity already in the system, I don't expect "long term contracts" would've been needed.

but even if it were- why is that bad?

Is Tesla magically NOT going to need to move this many cars or more next year?

Please. It is only lying if done in bad faith.

The man has repeatedly set near-impossible deadlines for himself and his companies, as a strategy for achieving more.

That is not lying, that is being ambitious.

My point was he announced "we are going to be producing X cars a week in 6 months"

And nobody at Tesla appears to have done anything to enable them to ship and deliver anywhere X cars a week.

That's a problem.

Especially since the factory managed to get surprisingly close to X in the time frame he laid out.