Tesla Grapples with “Delivery Logistics Hell”

Tesla Inc., which is beginning to overcome months of production snags for its Model 3 electric sedan, now faces the logistics challenges of delivering cars to customers.

“We’ve gone from production hell to delivery logistics hell,” concedes CEO Elon Musk in a Sunday tweet. He claims the latter problem “should be fixed shortly.”

Tesla sells its vehicles directly rather than through a dealer network. The company has been overwhelmed by its expanding ability to fill more than 400,000 orders for the Model 3 that have piled up since it began taking reservations more than a year ago.

The company hopes to build 55,000 of the $45,000 cars in July-September. Tesla delivered the first handful of Model 3s in July 2017. Production since then has improved at a far slower pace than Musk forecast at the time.

Social media reports surfaced late last month that thousands of Model 3s were piling up in storage lots in northern California. At the same time, purchasers have been complaining about repeatedly rescheduled delivery dates.

Last week, Musk announced that Tesla will narrow its exterior color options to help streamline production and deliveries.