Model 3 production continues after brief chip shortage

Tesla apparently wanted to shut down production for the Model 3 in Fremont for a fortnight due to an industry-wide chip shortage. But the production shutdown only lasted a few days. But there is also new information about the Model Y from Grünheide.

Tesla wanted to pause production of the Model 3 at its main plant in Fremont, California from 22 February to 7 March. The Bloomberg source did not cite a specific reason, but it was suspected that the shortage of semiconductors currently prevailing in the industry was the cause.

Elon Musk then confirmed the factory shutdown via Twitter, but also stated that it only lasted two days and that production has been running again since 24 February. Musk cited a general lack of parts as the reason. Since Musk wrote in the tweet “Fremont shut down for two days”, it is not entirely clear whether the entire factory or only Model 3 production was interrupted, as mentioned by Blomberg. But: Production is already up and running again and should be back to full capacity within the next few days.

Fremont shut down for two days (parts shortages) & restarted yesterday

— Elon Musk (@elonmusk) February 25, 2021

In an email to employees, quoted by Electrek, Musk also cited “parts supply issues”. But he also said that the production stop was used for “equipment upgrades and maintenance work”.

In that email, Musk also indicated that retooling for production of the recently unveiled new versions of the Model S and Model X was nearly complete. “We are targeting maximum production in the next quarter,” Musk said. “Because demand is high, we will soon have to go back to two shifts. Please refer friends for recruitment.”

Tesla seems to be focusing on the Model S first. In the configurator on the manufacturer’s US website, the delivery time for the Model S Long Range and the Plaid model has been changed to three to eight weeks. The first vehicles could therefore be delivered in March. For the Model X, however, the new delivery time for both powertrains has been pushed back to May to June. For the Model S Plaid+ with the new three-motor drive, delivery is still scheduled for “late 2021”.

Shortly after the revised Model X, the first units of the Model Y built in Germany could also be delivered to customers. Referring to a logistics expert, Teslamag reports that the pre-series production of the Model Y in Grünheide, Germany should start in May. Series production is planned for July/August. A Twitter user cites Deutsche Bahn as the source of their information. Deutsche Bahn is a customer of his software company and has been informed by Tesla that containers will be needed for prototypes from May and for the start of series production from July/August. The information has not been confirmed.

As is well known, a battery plant is to be built in Grünheide in addition to the vehicle plant. The 4680 cells presented at “Battery Day” in September 2020 could be produced there. At that time, Elon Musk had announced not only the cell format but also that the cell chemistry would be adapted to the respective model – from low-cost LFP batteries for volume models to batteries with high energy density for the top models. These batteries are to use a cathode with high nickel content.

It is this material that now seems to be a challenge in procurement. “Nickel is our biggest concern in scaling lithium-ion cell production,” Musk wrote in a tweet. Then he repeated his statement from “Battery Day”: “That’s why we’re switching standard range cars to an iron cathode. Lots of iron (and lithium)!”

This is the reason that you're going into mining too, right?

They cannot mine enough ethically-sourced metals for your needs.

— Pope of Muskanity (@RationalEtienne) February 25, 2021

In October 2020, it was announced that Tesla was negotiating with the Brazilian mining company Vale to buy nickel from a Vale mine in Canada. Musk had already courted mining companies and demanded that they mine more nickel.

Other cell manufacturers also rely on increased proportions of nickel and manganese in their cathode. SVOLT’s cobalt-free cells rely on 25 per cent manganese and 75 per cent nickel. Tesla could, however, benefit from the cells of another manufacturer: LG Energy Solution has apparently started building a pilot production for 4680 cells for Tesla at its Ochang plant. With this, the Korean company could have overtaken Panasonic. Panasonic had also announced a 4680 production, but the construction of a small production line is not yet known in the case of Panasonic.

With reporting by Sebastian Schaal, Germany.

electrek.co, teslarati.com, insideevs.com (Model 3 production and Model S,X update), teslamag.de (in German, Model Y in Germany), bloomberg.com (nickel sourcing), equalocean.com, teslarati.com (4680 cell production)