Advertisement
Canada markets closed
  • S&P/TSX

    22,167.03
    +59.95 (+0.27%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • DOW

    39,807.37
    +47.29 (+0.12%)
     
  • CAD/USD

    0.7385
    -0.0002 (-0.02%)
     
  • CRUDE OIL

    83.11
    -0.06 (-0.07%)
     
  • Bitcoin CAD

    95,024.51
    -645.16 (-0.67%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • GOLD FUTURES

    2,254.80
    +16.40 (+0.73%)
     
  • RUSSELL 2000

    2,124.55
    +10.20 (+0.48%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • NASDAQ

    16,379.46
    -20.06 (-0.12%)
     
  • VOLATILITY

    13.01
    0.00 (0.00%)
     
  • FTSE

    7,952.62
    +20.64 (+0.26%)
     
  • NIKKEI 225

    40,369.44
    +201.37 (+0.50%)
     
  • CAD/EUR

    0.6835
    -0.0008 (-0.12%)
     

Tesla (TSLA) Gains on Fremont Plant Retooling Details

Tesla Motors, Inc.’s (TSLA) shares gained 1.5% on Nov 18, after the company revealed details about the retooling of its Fremont ,CA plant for expansion of production capacity. As we know, Tesla had stopped production at the factory in the third quarter of 2014 for the retooling, which resulted in production loss of nearly 2,000 units.

During this time, the Fremont plant underwent assembly line upgrading, body shop capacity expansion, powertrain assembly improvement and betterment of facilities for the staff. Ten of the largest robots in the world were added to the plant in addition to one mile of work pitches.

The biggest change has taken place in the general assembly, where advanced robots have been installed to lift and move cars between the floor and electrified rail, apart from other heavy lifting work. These robots will also be used to install battery packs in Tesla’s cars in the near future, thus cutting the installation time to half from the current four minutes.

Tesla also established a separate section to build the Dual Motor Model S. A significantly automated line will now produce the drive units for the 85D and P85D versions of Model S. Moreover, the automaker has kept extra space to expand the capacity of this line in the future without affecting other operations.

ADVERTISEMENT

The addition of conveyors and advanced robots in the powertrain department has increased the processing capacity to 1 million battery cells per day from 800,000 earlier. The increased welding equipment in the body-in-white department has hiked the production uptime by 5–10%. Further, the addition of 24 new tire and export docks has speeded up the overseas delivery process.

The factory interiors have also been improved by adding skylights, plants, LED lights, frames photographs and printed illustrations on glass walls. The grey color of the walls and floors has been replaced by white.

Consequently, the production process has become more automatic and the plant can produce cars faster. Further, the work environment has improved. The retooling will result in 50% higher production in 2015, compared to the expected production of 35,000 units in 2014. Currently, the assembly line produces nearly 1,000 cars per week, while Tesla is targeting 2,000 units per week by the end of 2015.

Currently, Tesla carries a Zacks Rank #5 (Strong Sell). Investors interested in the auto industry may consider stocks like Gentex Corp. (GNTX), Douglas Dynamics, Inc. (PLOW) and STRATTEC Security Corporation (STRT), all sporting a Zacks Rank #1 (Strong Buy).

Read the Full Research Report on GNTX
Read the Full Research Report on STRT
Read the Full Research Report on PLOW
Read the Full Research Report on TSLA


Zacks Investment Research