Thursday, September 27, 2012

Tesla Motors Continues To Over Promise, Under Deliver

Prior to the open on Tuesday, Tesla Motors (TSLA) announced that Q3 revenues would not meet analyst estimates. The company is having significant problems ramping production and obtaining supplies on time.

Did you catch that part about issues with suppliers? Seriously? Production was half the forecast and only 300 vehicles in Q3, yet suppliers couldn't keep up. That clearly can't be a good sign, as these suppliers must typically deal with thousands if not millions of parts for other automakers.

This is starting to remind me of the Dreamliner plane built by Boeing (BA): an innovative product that took much longer to produce due to the complexities of a new design and a diverse supplier network. The only difference is that Boeing lacks major competition while also having the capital to withstand any setbacks.

Read the full article at Seeking Alpha.


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