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Musk promises no more 'bet-the-company' projects after Model 3

by Justin King
Musk promises no more 'bet-the-company' projects after Model 3

The Model 3 is Tesla's third bet-the-company situation, following the critical Roadster and Model S launches.

Tesla CEO Elon Musk has vowed to take a different approach to future development projects, promising the Model 3 will be the last "bet-the-company situation."

Speaking to Bloomberg for a recent interview, the embattled executive shed more light on his personal struggles and Tesla's many challenges that occurred during the extremely ambitious Model 3 production ramp-up process.

Musk admits that the company's entire future hinges on its ability to meet Model 3 output targets, which finally exceeded 5,000 units for a single work week.

"The number of people who thought we would actually make it is very tiny, like vanishingly small," he acknowledged. "There was suddenly the credibility of the company, my credibility, you know, the credibility of the whole team."

The executive has been on the front lines, sleeping under a desk at times and spending long shifts on the factory floor alongside workers to help resolve problems. The approach is said to have been successful in motivating employees.

"At GM they've got a special elevator for executives ... so they don't have to mingle with anyone else," Musk said. "The reason people in the paint shop were working their ass off is because I was in the paint oven with them. I'm not in some ivory tower."

Tesla has faced several "bet-the-company" moments in its history, starting with the Roadster that was its only product in the early stages of the company's history. The second such situation was the Model S, requiring a leap from a few hundred cars annually to 20,000 units and in-house development of a more sophisticated car. Now, with the Model 3, output targets have jumped into the hundreds of thousands.

"But I do not see us doing another thing where we go five times bigger," Musk explained. "Once we break through to mass market cars, where mass market is on the order of a quarter million vehicles per year, I cannot see us doing a 1.2 million-vehicle program of one particular model."

The more cautious thinking has already extended forward to the Model Y. The Model 3's high-riding sibling was initially expected to ride on an entirely new platform, but Musk later decided it would be a better idea to share underpinnings with the Model 3 to avoid another production fiasco.

Despite switching many newly automated processes back to manual assembly during Model 3 ramp-up, Tesla is still committed to a longer-term transition to extremely high-speed robotic manufacturing of automobiles.

The company has almost finished the design of the Model Y, with a tentative prototype debut target of March 2019.