Tesla, an American electric car manufacturer, is planning to revolutionize the way cars are produced by moving away from the traditional assembly line approach that has been in use for about a hundred years. Instead of building cars in a linear fashion with each part of the car assembled one at a time, Tesla envisions a production process where different parts of a car are built simultaneously in specific spaces and then combined to create the final product. This new approach is expected to reduce Tesla’s manufacturing footprint by more than 40 percent and enable the company to build future factories faster and cheaper.
Tesla believes that this new production process could potentially cut its production costs in half, which is critical for achieving its goal of introducing a cheap electric car to boost demand. Elon Musk, CEO of Tesla, has described the new system as “revolutionary” and “far more advanced than any other production system in the world.”
However, analysts caution that the system has not yet been proven and could come with inefficiencies and risks. A recent analysis by Bloomberg suggested that the new modular manufacturing process may only reduce costs by a third, rather than half as Tesla hopes. Despite these uncertainties, Tesla is aiming to dramatically increase its production from 1.8 million cars delivered last year to 30 million cars by 2030. Achieving this ambitious goal will require the company to offer significantly cheaper cars, making the success of its new production system even more crucial for its future growth and sustainability.
