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Tesla Model X SUV delayed – again

X marks the stop: The first Tesla SUVs will not be rolling off production lines until late next year due to another delay caused by factory commissioning and model development.

‘More validation testing’ pushes Tesla Model X production start to late 2015

Tesla logo10 Nov 2014

By DANIEL GARDNER

TESLA Motors has pushed its Model X production start date back for a second time, delaying the arrival of the all-electric SUV until late 2015.

The North American electric car-maker made the announcement in a letter to its shareholders, saying the latest reshuffle would allow for more “validation testing” resulting in “the best Model X possible”.

By extending the pre-production development, Tesla says the production ramp-up will be faster than for the Model S, reducing the likelihood of supply problems when the SUV model joins the sports sedan in showrooms.

The first Model Xs were originally chalked to roll off production lines last year, but the company bumped that date to allow early repayment of a $US465 million ($A536m) loan pushing production start-up back by a year.

This latest setback will keep prospective Model X owners waiting another year for the zero-emissions SUV, but the letter signed by CEO Elon Musk and chief financial officer Deepak Ahuja said the delay was necessary and sacrifices company cash to ensure the quality of the product.

“We prefer to forego revenue rather than bring a product to market that does not delight customers,” the company said.

“Doing so negatively affects the short term, but positively affects the long term.

“There are many other companies that do not follow this philosophy that may be a more attractive home for investor capital. Tesla is not going to change.” Readying the Freemont factory for Model X production and increased Model S production has taken “longer than expected”, but Tesla says the relatively small delay in the short term will allow the company to boost production to 2000 vehicles per week by 2015.

An almost unprecedented productivity increase is forecast by the car-maker, with a 50 per cent increase predicted for “several years” – enabled partly by the arrival of the new model.

Future investments were also outlined in the shareholder address, with a paint shop upgrade planned, the Nevada Gigafactory now under construction and $US350m to be spent before the end of this year.

Orders for the Model S in Australia are being taken now, with first deliveries expected next year. A new double-motor four-wheel-drive flagship variant was recently introduced, taking the line-up to six.

However, in its recent statement Tesla also explains it intends to “simplify our product” by reducing the number of options and powertrain combinations – another measure necessary to expand production.

The effects of the streamlining can already be seen on the Tesla Australia website where the double-motor option is now only available on 85 and P85D variants. The latter is only available in four-wheel drive, taking the range down to four choices.

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