Tesla Halts Production to Prepare for Model X

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IHS Global Insight

July 24, 2014

Will offer new battery for Roadsteróreport

Tesla has stopped production July 21 at its only assembly plant to prepare for the Model X sport utility vehicle (SUV) and speed up Model S production, according to a Bloomberg report. Production is due to restart on Aug. 4. Tesla spokesperson Simon Sproule told the news outlet, "This represents the single biggest investment in the plant since we really started operations and enables us for higher volumes. It gets us ready to build X and to do on the same line as the S."

Tesla leader Elon Musk had earlier stated a goal of delivering 35,000 Model S sedans to global customers in 2014, and to increase production to about 1,000 units per week, from 700. Employees are given the option of taking holiday time or coming to the plant for maintenance and training shifts during the shutdown. The company employs 6,000 at its plant, headquarters, design center, stores and service facilities. Separately, the company said that is planning to offer upgrades to the Roadster batteriesóalthough it has not said at what cost.

Sproule told USA Today that, "Improvements to the battery are coming for Roadster...[it] had an old-generation battery. We'll upgrade it to a new-generation battery pack," and that could boost range from 245 miles to 400 miles.

In June, Tesla confirmed the Model X is on track for a production start later this year. First deliveries of the company's second EV are due to begin in early 2015. In adding the second model and looking to increase production of the first, the company is increasing the level of complexity. The X and the S will be made on the same assembly line. Tesla made about 2,500 Roadsters in its short run. Upgrading the battery provides an interesting business model, as it is similar in concept to just getting a new engine, depending on the cost of a $109,000 two-seat roadster.

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