Guest essay by Eric Worrall
h/t Breitbart – According to The Guardian, Tesla’s recent layoffs include an entire quality control department.
‘How do they expect to run without us?’ Tesla accused of axing key staff to cut costs
Electric car firm slashed 7% of workforce this month and ex-employees say more experienced staff were targeted
Alan Ochoa worked at Tesla’s Fremont plant in California for four years. He was laid off recently along with his entire department in quality control, many of whom were also long-time employees. “I have no idea how they expect to run without us,” said Ochoa.
The electric car company releases its latest financial results on Wednesday and analysts are not expecting good news. On 18 January, founder Elon Musk sent out a mass email to employees announcing 7% of the company’s workforce were being laid off, in addition to cuts to temporary and contracted employees, and warning of a “very difficult” road ahead.
Ochoa predicts Tesla’s “difficult road” will not be helped by laying off experienced staff.
He said: “My last repair on Friday was finding a rear fascia was missing a screw so if you pulled on it, it would pop out. I grabbed a drill, the screw, got down on my knees and made the repair myself. No one would have known about it unless they tugged on the edges of the rear fascia like I had made it a habit to do.
“But I know once the car starts driving it would become unseated due to the wind pulling it out.”
…
Tesla has suffered quality control setbacks in the past and workers fear those issues may be worsened by the cuts. Ochoa explained he was making several dozen repairs a day on quality control, depending on what line he was on.
He said: “I fear the quality will be greatly diminished. Not all of my repairs were easy to see but would have a lasting effect.”
Read more: https://www.theguardian.com/technology/2019/jan/30/tesla-factory-elon-musk-layoffs-company
If the Guardian report is correct, I’m shocked that Tesla appears to have downgraded quality control.
Despite not containing gasoline or an internal combustion engine, Tesla vehicle components like the large lithium battery packs are potentially very dangerous. The following is a slow motion video of University of Maryland setting fire to a small Lithium battery pack. Around 3:16 in the video (remember the video is slow motion), the battery pack appears to violently explode, though the explosion does not prevent the pack from continuing to burn;
Lithium is an alkali metal, a group of highly flammable metals which sometimes explode violently on contact with water. While Lithium is less reactive than some of its siblings, it is still extremely dangerous. Large Lithium fires are difficult to extinguish. Any explosion caused by trying to douse the fire with water can scatter droplets of molten burning lithium, causing severe heat and chemical burns if the droplets of molten lithium come into contact with exposed flesh.
Assuming the Guardian story is true, I don’t know if firing an entire quality control department is likely to make Tesla cars less safe. But if I was a buyer waiting for delivery of my new Tesla, I would be contacting my Tesla dealership with some fairly urgent inquiries.
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Tesla’s stock price is based on a belief among shareholders that Tesla is a furlong ahead of the competition. Musk talks about “gigafactories” and a 30% margin on the Model 3. If that was true, it would mean he had a huge lead on all the major car-makers. If that was true.
He convinced investors that his market share was going to be massive. Musk, being smarter than everyone else, was convinced that production line automation was going to allow him to scale up fast, and would keep costs low. Supposedly production engineers who spent their entire careers designing production lines, and integrating automation into their lines had the formula wrong. But mass production is turning out to be harder than Musk anticipated. And there is no way he was telling the truth about the Model 3 margins. The Model S might be an automotive marvel, but luxury cars are a niche product. It’s not something you need a “gigafactory” to produce.
I don’t see any evidence that he has a lead in technology — either in electric cars or in automation. And he has a huge disadvantage in scale and depth, going against car-makers who invented mass production and know how to put out hundreds of thousands of units. Tesla engineers are going up against GM, BMW, Volvo, Honda, Ford, and everyone else. Those guys aren’t dummies. It’s a crowded field now, with over 50 electrical cars available for sale.
Tesla is not going to go out of business anytime soon. Musk has not wanted to go to the capital markets for more funding, but they are certainly able to raise as many billions of dollars as they need.
>b>Steve O: “Tesla is a furlong ahead of the competition.”
According to Wikipedia, on May 14, 2008, the race horse Winning Brew set the Guinness World Record of 2 furlongs in 20.57 seconds. My math says Telse is 10.28 seconds ahead of Winning Brew and possibly its competition.
If the Guardian article and Alan are to be believed then there is something seriously wrong with the way Telsa do manufacturing.
Alan is suggesting that he is having to do several repairs a day. This suggests two things. First is that there are multiple random errors constantly occurring during assembly, or that the same error is occurring on multiple vehicles. Neither is good. The first implies an overall degree of shoddiness and the second suggests that errors are only being fixed, and no reported but up so the root cause can be identified and either the design or the process modified to eliminate the problem.
So, while I admit the Guardian is filled with a bunch of code writers in waiting and about as reliable as a political Wikipedia page, I am also someone who can use the word FRACAS in professional conversation. Either the Guardian has no idea what they are reporting, or something is very rotten in the state of Tesla.
Either the Guardian has no idea what they are reporting, or something is very rotten in the state of Tesla
Why limit it to one or the other, both can be true. Even the blind squirrel occasionally finds a nut.
virtue vanity clients will not complain … admitting you are the mark is never easy … and with so much virtue signaling tied up in the purchase very few buyers will complain …
Going immediately luxury when the tech is in development was a huge mistake. Henry Ford and Toyota knew that filling the roads up with an affordable reliable car was the ticket. Then make some classier models when you have cash flow to take advantage of the much smaller market to collect on the high end. Trying to mass produce a car for a relatively tiny market -because it’s both luxury and novel (before the market is comfortable with it) shows hubris is overpowering good business sense.
Go with a plan to make 10 million Tesla Dune Buggies in which you have to wind your own windows and slam your own trunk and go for extended range for $19,977 plus extras. Someone is going to do this! Think the reverse snobbery of the VW bug. Then with your own money start working on your Tesla Dune Bugatti.
https://en.m.wikipedia.org/wiki/Bugatti_Veyron
That would require a really cheap li-ion battery, which will never happen since the materials (cobalt, lithium…) are intrinsically expensive to produce.
tty nonsense. The dune buggy would also use 18kwh packs instead of 75kWh of the cheaper Tesla mod S. Apriori reasoning on this site won’t get you far.
Cobalt prices have spiked at $40/lb, but are back around $16, their longer term price and new cobalt finds in Canada and elsewhere support the expected in the mining industry that when you look for it, you find more. Tesla itself may have been responsible with the spiking with gigafactories talk.
Similarly, lithium carbonate (and LiOH•H2O a bit higher) spiked at over $20/kg but sits around half that presently. As with other commodities that develop high demand and prices, the ~half dozen producers that comprised the industry 20yrs ago produced 6,300t/yr of contained lithium. Today, the expanded industry of ~a dozen poroducers puts out 43,000t contained Li and there are over 400 exploration and development projects, once again, the seek and ye shall find nature of the mining industry that Malthusians have never understood.
18kWh. In other words a car that may or may not have enough charge to get to work and back, especially if you have to use the AC or the headlights.
As alread pointed out lithium ion batteries don’t contain lithium metal. Non-rechargeable lithium batteries do.
The very nasty lithium ion battery fires are caused by the combination of an organic and very flammable electrolyte, a large heat-source when a cell shorts and a tight cell container that will however not withstand a large overpressure.
The end result is that a large battery pack will in effect behave as a set of thousands of little flame-throwers that may pop off one at a time, or a lot together. This is the reason for the intense, almost gas-welding like flames seen at Li-ion fires as well as the occasional more dramatic “explosions” (really a number of cells bursting together and causing a deflagration).
Impurities of transition elements were the main culprit in early fires. New specs are reducing these from ppm to ppb. Heck a bunch of lead acid batteries with that level of power would be even less fun. The idea of huge storage units for renewables are essentially a bomb.
In my experience with quality control, it isn’t quality control’s job to inspect every nut, bolt, screw etc and it REALLY isn’t Quality Control’s job to repair deficiencies.
If this guy was just fixing things like missing screws and incorrectly assembled parts, he wasn’t doing Quality Control, he was just another part of the assembly line.
Quality Control’s role *should* be to inspect for deficiencies in the assembly process and, when deficiencies are identified, effect remedial action. You know…*control* quality.
Remedial action could be anything from changes in the assembly process, improved tools and techniques, changes in line speed or even replacing less than diligent assembly personnel if needed.
Just fixing the mistakes they find and moving on, doesn’t improve the process to reduce the number of mistakes, and they can never hope to catch them all.
1. I’d say they were right to get rid of the QC department. It was a fool’s errand anyway, they were wasting their money.
2. If that’s Tesla’s idea of quality control, I wouldn’t take one of their cars if you gave it to me. I can see why they’ve “suffered quality control setbacks in the past”
***Disclaimer: All of my QA experience has been in Aviation Maintenance. I grant that QA is a bit more important in aviation than in ground transportation…a loose fascia doesn’t cause a Tesla to fall out of the sky from 30k feet…however I can’t imagine the principles are that different. Perhaps I’m just ignorant about the auto industry and they all do it that way.
Tesla dropped 13 dollars this morning right off the bat on this news. Now 18 minutes later it is only down around 1 dollar. Lots of resilience in Tesla stock.
Someone is buying. Chinese, Germans or even Tesla itself. Not allowed but in desperate situations….
Frankfurt (FRA) closed today with Tesla (TL0) up by 1.39% to 268,00 €.
“He was laid off recently along with his entire department in quality control, many of whom were also long-time employees. “I have no idea how they expect to run without us,” said Ochoa.”
Laying off an entire quality control department does not make sense to ‘save’ money. The quality control department fixes problem to ensure products are safe.
Tesla cars have had three times the number of deaths than other comparable luxury cars.
You guys are missing the real story. Tesla’s, Quality Control department, knows where the skeletons are.
“Sometimes I can’t park it in my driveway because it says I’m going 20mph while stopped and won’t let me park. I can be driving on the highway and the screen will freeze.”
There are Tesla owner reports of car doors opening while driving. That type of problem if there is a death brings a lawsuit.
If there are lawsuits senior members of the Quality Control department would be subpoenaed. When did you know of so and so problem? What action did you take? Where their other problems?
Tesla is a drive by wire car that has a very, very complicated computer control system and set of sensors.
Tesla is different than an ugly Pacer. Tesla is a very, very complex car that without ,Tesla the company, might not be safe to drive or might not be possible to drive.
https://medium.com/@MidwesternHedgi/teslas-driver-fatality-rate-is-more-than-triple-that-of-luxury-cars-and-likely-even-higher-433670ddde17
“Tesla’s mortality rate (41 deaths per million vehicle years) is so much higher than the average luxury car (13 deaths per million vehicle years) that when comparing the two, the difference is hugely statistically significant. The difference is 28 additional deaths per million vehicle years, with a confidence interval of 11 to 63, and a p-value of 0.0001.
Remember that, unless California Tesla driver deaths magically went to zero in 2016 as Tesla increased production, and unless there were zero unreported deaths in the rest of the world, the true value for Tesla’s fatality rate is likely even higher. Regardless, Musk’s assertions that Tesla is the “safest vehicle” on the road or “four times better than average” are ridiculous untruths. Tesla’s driver fatality rate was massively higher than luxury peers, and at least 37% higher than the average 2011–2014 car. Musk’s “safest vehicle” on the road claim is as phony as his 2016 solar neighborhood.”
These numbers are terrible. Thanks a lot for that very valuable info. It will frighten the sh*t out of many.
Well, I think it would be more appropriate to compare Teslas with sports cars than luxury cars, because that is basically what they are. The safety issue with all such cars is the firmware installed in the computer a few inches in front of the headrest.
Rabid fans have been snapping up Tesla vehicles for years while overlooking quality control problems associated with windshields, computer display, paint, trim fit and finish, and excessive/misaligned gaps between adjoining parts. Why should Tesla be concerned now about QC?
Alan Ochoa worked at Tesla’s Fremont plant in California for four years. He was laid off recently along with his entire department in quality control, many of whom were also long-time employees.
********************************************************
so…4 years is considered long time employee?
Yes, for a 4 year old company.
Just don’t get redirected to the PR department when contacting them.
Just route all of the customer service calls to PG&E to save money.
Tesla is an interesting story that is gaining momentum.
It was announced this Wednesday, that the Tesla chief finance officer’s is ‘retiring’ just two years after rejoining the business.
The vice president of customer service left Tesla this September. See below for other senior staff who have left.
“Mr Musk had already warned of a challenging period ahead when he wrote to employees this month to announce job cuts of 7 per cent. He said then that Tesla was targeting “a tiny profit” in the first quarter, which it would only make “with great difficulty, effort and some luck”.
https://www.ft.com/content/91d3d6fa-24b9-11e9-8ce6-5db4543da632
Tesla’s troubles mount as finance chief quits
David Tamberrino, an analyst at Goldman Sachs, wrote on Thursday that a change of CFO “may cause some uncertainty for investors” given the company’s challenges in the coming year.”
https://electrek.co/2018/06/14/tesla-vp-of-worldwide-service-leaves/
Karim Bousta, Tesla’s ‘Vice-President of Worldwide Service and Customer Experience’, left the automaker this week.
https://www.autoblog.com/2018/09/20/tesla-vp-of-global-supply-management-reportedly-resigns/
Tesla’s vice president of global supply management, Liam O’Connor, has resigned, Bloomberg reported, citing sources familiar with the matter.
The departure of O’Connor, who joined Tesla in March 2015 from Apple, follows the exit of a string of senior executives, including Chief Accounting Officer Dave Morton and Chief People Officer Gabrielle Toledano.
I wonder how Teslas are doing in the freezing Midwest.
People have been predicting the imminent demise of Tesla since its inception. The last year or two has been the worst. But because I’m a contrarian, and think that betting against Elon Musk is generally a losing proposition, I’m betting that Tesla will still be around this time next year, and no, not in receivership.
Anything written in the “guardian” should be treated with great care. They are totally focused on manipulating the left wing agenda.
Solar City, SpaceX, and Tesla all laid of workers. The Boring Company has what turns out to be a questionable product that doesn’t come close to promises …. it’s a slow speed car tube that will be seriously impacted by the loading/unloading cycles and not a high speed vacuum transport capable of moving groups of people at high speeds. Solar City is in a death spiral and Tesla is trying to join. Silicone Valley has a penchant for flaming out entrepreneurs and Musk is no different. All visionary, yet arrogant and don’t know when to stop taking bigger bites and complete chewing what they have.
Worked for a major Turbine Package manufacturer that had made a similar management decision. Our products were know world wide for been bullet proof when delivered from our factory. The customers used to hook up the power inputs, either the generator outputs or the compressor piping and the fuel line and the units would fire up and run just about every time. During this period the company had 1 quality control person for every 3 people on the manufacturing floor with a rigorous sign off check sheet that was stamped off by all parties. Decision was made to reduce costs and they went to 1 Quality control person for 20 people on the floor. CHAOS. When the units arrived in the field we poor commissioning guys were suddenly having to complete the installation of package systems that were not complete or installed wrong. Our part failure rate for commissioning jumped by 250% as the rigorous In factory package testing was also reduced. The reason for these changes was that we built such a great product we did not need the amount of quality control and testing that we were doing. The company almost went broke because of the CHAOS. The worst problem was trying to get upper management to relies that there was a problem. The field groups and remote districts were eating the rework and repairs NOT the factory so out of sight out of mind was the higher ups way of running things. It took a large slump in sales before someone woke up to the fact that something was wrong. After a large investigation into all the problems the factory increased the Quality control department but it took 5 years of pain to root out all those that had caused the grief in upper management.
The real issue facing Tesla owners will be that the company has always insisted on having total control over sales of spares, so if it goes down the tubes maintenance could become difficult. I guess someone might buy up the stock and start supplying it, but who knows. I’m not in the market for one, but that is an issue which would make me think carefully.
If you can, buy anyone of these cars. Seal it up and store it for say 40 years. After that it will be worth possibly millions.
Don’t forget to remove all the batteries unless you are an artist and admire corroded cars.