2,651 hours/week * $30/hour = ~$80k/week. on a volume of cars that brings in $200m/week. so what? its a minor inefficiency.

Per employee doing rework. To complete tasks which involve taking pieces off and putting them back on in ~30 minutes, you're probably looking at up to 10 people (for example, changing a bushing on a Mercedes that requires the complete disassembly of the rear of the car is around 6 hours of labor).

As a point of comparison, large car manufacturers get into the "how much would a lawsuit and recall cost" when discussing adding costs of $4-$5 per car.

not really. each rework is the equivalent of a branching prediction failure in a very very long cpu pipeline.

all tasks are massively parallelized in a production line. to reach 5000 car month tesla need to crank a car every seven minutes.

now imagine a production line that pump a car out every seven minutes and you need 37 minutes manual labor for each of them

the inefficence doesn't look so minor. it's also a logisticsl nightmare, just imagine parking all those cars while the rework stations free up.

In the time it takes one person to do the 37 minutes of rework you have taken 5 more cars off the line.

So 6 mechanics in 6 bays at the end of the line do the rework jobs and cars continue to flow out of the plant one every 7 minutes.

An extra $20 in COGS per car. Is this really so horrible? What am I missing?

Even if it’s 10 mechanics and 10 drivers moving cars into and out of the bays, with some bays idle some of the time and let’s call it an extra $60 in COGS.

Their gross margin is already way better than anyone expected to see on the Model 3, they used some very impressive electrical design to save in so many places.

Even just their rear view mirror is more than $50 cheaper than the competition’s mirrors because of their smart electrical design. [1]

Right now they need volume more than anything else. Speaking as a reservation holder.

[1] - https://www.teslarati.com/tesla-model-3-solidly-profitable-s...

> What am I missing?

just on top on my mind tooling, factory space, training, burnout, turns, above average defects that will have to be handled by the post sales network.

> they used some very impressive electrical design

oh yes they are brilliant car, no question about that. it's less impressive when you get an engineering marvel and the build quality is random depending on the hands that worked on it in post processing.

> the inefficence doesn't look so minor. it's also a logisticsl nightmare, just imagine parking all those cars while the rework stations free up.

To park a car every seven minutes? Maybe one extra full time employee?

> logisticsl

(and btw it's 3x that because full time still only means 8 hours a day)

Per [0] it seems like line workers make ~$20/hr, so that's over $50,000 per week to fix the cars, not including the cost of parts or associated delays. It's only about $12 per car, but for Tesla I imagine every dollar counts.

[0]: https://www.indeed.com/cmp/Tesla/salaries?location=US%2FCA%2...

That's assuming the cost of labor is the only operating factor here. There are assumedly parts, factory operation, other opportunity costs at play here.

Also, since Tesla has all of these cars under warranty themselves, if they do have issues after delivery, which quality control problems like this usually indicate it can really blow through their margins quickly.

It's a bit more than the output from a single person in a year. You just have to hire 2 more guys and you're good.

It takes 9 months to make a baby. You can't get 9 women and produce a baby in a month.

2 new guys don't have a year to rework 4300 cars.

So basically one full time employee for a year.

It depends on what parts need rework. It may not be doable by one employee.

If it's $80K a week, isn't that more like ~50 full-time employees for a year?

Oh I didn't realize it was per week. You're right.