Tesla is stuck with over 10,000 cars on factory hold, resulting in a logistical nightmare


Tesla has over 10,000 electric cars that came out of Fremont Factory on a “containment hold” and can’t deliver them to customers, according to sources familiar with the matter.

It is likely going to lead to a logistical nightmare at the end of the quarter.

Since Tesla owns its entire distribution network and doesn’t sell to third-party dealers, the automaker has been known to have difficult end-of-quarters where it is trying to deliver as many vehicles from the factory to customers in order to keep its inventory low.

It leads to fairly intense end-of-quarter pushes, but things had finally stabilized during the last two quarters.

Now, Tesla employees are again expecting a crazy end-of-quarter, but this time, it’s due to a supply chain issue.

Sources familiar with the matter told Electrek that Tesla is having an issue at Fremont Factory, resulting in Model 3 and Model Y vehicles coming out of the assembly line with a “containment hold,” which means that they cannot be delivered.

Tesla is keeping the reason for the containment hold close to its chest, but sources familiar with the matter told Electrek that an unknown part is missing.

CEO Elon Musk said last month that Tesla was having significant supply chain issues.

The issue is small enough that it can be fixed by the service team, according to sources, but the problem is the volume and delayed deliveries.

Sources familiar with the matter say that between 10,000 and 20,000 vehicles are affected by the containment hold.

The number could go up, as there were no known fixes nor a timeline for a fix as of yesterday.

Tesla is still moving the vehicles to delivery centers since the fix doesn’t have to be performed at the factory, and the automaker cannot keep that many vehicles at the plant.

Nonetheless, it is expected to create a logistical nightmare for Tesla’s service and delivery teams, who are going to face a lot more work once the fix is available.

Electrek’s Take

The way I see it, the best case scenario is a massive logistical nightmare on top of the end-of-the-quarter push.

Worst case scenario, it actually pushes some deliveries into the third quarter and negatively affects Tesla’s Q2 results.

It’s a bummer because, as we reported earlier this month, Tesla’s demand is currently through the roof.

The automaker was on its way to another record quarter. I am not saying it’s now impossible, but it is certainly going to be a lot tougher.

If you have more information about the situation or any other interesting Tesla info, feel free to reach out via email at fred@electrek.co, via Wickr: Fredev, or through my social media: Twitter and Instagram.

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