As Elon Musk addressed shareholders at the company’s annual meeting, he complained that his efforts to get out a promised volume of the new Model 3 may have been the most “hellish months” he had probably ever gone through. Investors were not terribly sympathetic. Tesla Inc. (NASDAQ: TSLA) shares rose less than 1% after the meeting and are still down 17% over the past year.
What Musk did not comment about is how hellish the Model 3 catastrophe period has been for investors. Musk has promised over and over that production of the inexpensive electric car, which is essential to Tesla’s future, would reach the critical mass of 5,000 units per week.
At one point, there was a backlog of 400,000 people who had put deposits down to get the car earlier than the general market. It would take 80 months to deliver them all, unless, of course, Tesla ramps up production further. And then there are the hundreds of thousands of other people who want to buy the $35,000 car.
Over the period in which Musk has ramped up production, there have been rumors of poor employee treatment, trouble with suppliers and shoddy manufacturing facilities. Outsiders could not tell why the delays had become so long because Tesla rarely gave exact reasons for the problem.
Musk’s vagueness continued at the annual meeting. He said the production of 5,000 Model 3 cars a week by the end of June was “quite likely” and that the assembly line was pushing out 3,500 now. Based on his forecast, production would need to rise a little over 40% in three weeks to hit the number.
Musk dodged on a bullet when proxy votes for the annual meeting were counted. He will be able to keep his jobs as both chief executive officer and board chair. Three of his hand-picked directors won challenges that would have pushed them out of their seats.
Musk’s problems have almost nothing to do with what titles he holds. They do have everything to do with whether the “hellish” period at Tesla is over.