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RENO — Tesla CEO Elon Musk says the Nevada factory making battery packs for the company’s Model 3 mass-market electric sedan dramatically increased output in recent months.
Musk said the Reno-area “Gigafactory,” as he calls it, produced a “sustained rate” of 3,000 battery packs per week and has reduced the amount of time it takes to make a pack from seven hours to 70 minutes.
“In general, our understanding of production is improving dramatically, exponentially in fact,” Musk said in a conference call with investment analysts.
He said the Gigafactory, for a short period of time, produced battery packs at a rate that would equal 5,000 per week.
“If you can achieve it even once in an hour then with continued refinement of the system … it means that you can achieve that sustained rate,” Musk said.
It’s a drastic improvement from six months ago when Musk was blaming problems at the factory for derailing production of the Model 3, a car that’s critical to the future of the company.
During a conference call with analysts Musk said improvements at the Gigafactory and Tesla’s car factory in Fremont, Calif., will help the company meet an important, yet elusive, production milestone of 5,000 Model 3 vehicles per week.
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“I feel very confident about our ability to get to 5,000 very soon, sustained rate at Giga,” Musk said during the call to discuss first-quarter earnings, which included heavy losses.
The Gigafactory produces batteries and drivetrains for the Model 3. Other production and assembly occur in Fremont.
In October, Musk predicted the company would hit the 5,000-mark by the end of the first quarter of 2018, a postponement of a previous forecast in which he said Tesla would hit it by the end of 2017.
But it hasn’t come easy. Musk acknowledged Tesla’s aggressive automation efforts in the Gigafactory and in Fremont have led to costly mistakes and delays.
“We did go too far on the automation front and automated some pretty silly things,” Musk said.
By way of example, he cited a failed attempt to automate the process of placing sound-deadening, fiberglass “fluff” on battery packs. The machines, which Musk referred to as “Fluffbots,” failed to do the job with precision and were ultimately taken out of commission.
“Machines are not good at picking up pieces of fluff, hands are way better at doing that,” he said. “We had a super complicated machine using a vision system trying to put pieces of fluff on a battery pack.”
To continue to increase production while recovering from self-inflicted mistakes the company has been attempting to hire hundreds of new workers per week.
The hiring is costing investors big money but it should help Tesla maintain the employment and investment at the Gigafactory the state of Nevada set forth in exchange for tax breaks and incentives worth $1.3 billion over 20 years.
Products built at the Gigafactory include the drive unit and battery packs for Model 3 sedans and the stationary Powerwalls and Powerpacks, which are used for energy storage for homes, businesses and utilities.
The Gigafactory as a whole, including Tesla and partners Panasonic and H&T Nevada, employed 2,417 at the end of September. It’s also employed 12,411 construction workers. Companies have spent nearly $3.3 billion.
Contributing: Chris Woodyard, USA TODAY .