Elon Musk asks Tesla staff to cut delivery costs: CNBC

  • Tesla CEO Elon Musk urged employees to reduce the cost of delivering vehicles, CNBC reported.
  • In a company-wide email, Musk said Tesla should stop spending a lot on acceleration fees.
  • The push comes amid a nationwide shipping crisis that increases costs.

Elon Musk urged Tesla staff to focus on reducing the cost of delivering electric vehicles to customers on Friday, CNBC reported.

In a company-wide email sent to all staff and transcribed by CNBC, Musk said, “Our goal this quarter should be to minimize delivery costs rather than spending heavily on acceleration costs. . ”

He added: “What has happened historically is that we sprint like mad at the end of the quarter to maximize deliveries, but then deliveries drop drastically in the first few weeks of the following quarter.”

Tesla did not immediately respond to Insider’s request for comment.

Rushing to deliver cars by the end of a quarter is standard practice at Tesla. Insider’s Graham Rapier reported in 2019 that the company asked employees to help deliver 30,000 cars in the last 15 days of the quarter.

Musk has already acknowledged Tesla’s delivery problem like “logistics hell,” according to Reuters.

Customers sometimes experienced delivery delays of several months. In August, Tesla Model S and Model Y customers complained that they were waiting up to four months to receive their cars, Insider’s Isobel Hamilton reported.

In 2019, the electric vehicle maker announced the purchase of its own automatic transport trucking capacity with the goal of delivering cars faster and improving the company’s logistics systems, Insider’s Rachel Premack reported. .

Tesla’s decision to focus on reducing delivery costs comes amid a nationwide shipping crisis fueled by COVID-19 disruptions and a severe labor shortage. Shipping costs have skyrocketed as a result.

According to CNBC, in Friday’s email, Musk lamented the fact that, indeed, over a six-month period, Tesla would not have delivered any additional cars but “would have spent a lot of money and burned out. to expedite deliveries in the last two weeks of each quarter. “

The email added: “It is nevertheless a good time to start reducing the size of the wave in favor of a more regular and efficient delivery rhythm.”

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