Tesla still lags behind on Model 3 deliveries

The production hell of Tesla's Model 3 is far from over. The electric-car maker said on Wednesday that production of the much publicized Model 3, in the final quarter of 2017 was way short of initial targets and despite making “major progress” addressing production bottlenecks, the company has pushed back its target of producing 5,000 Model 3 sedans per week to the end of the second quarter.

"As we continue to focus on quality and efficiency rather than simply pushing for the highest possible volume in the shortest period of time, we expect to have a slightly more gradual ramp through Q1, likely ending the quarter at a weekly rate of about 2,500 Model 3 vehicles," Tesla said in a release. "We intend to achieve the 5,000 per week milestone by the end of Q2."

Priced at $35,000, the Model 3 has been touted by Elon Musk as an affordable, high-volume compact sedan that would enable Tesla to sell more than 500,000 cars a year starting in 2018. Tesla says that it made progress addressing the bottlenecks that have been inhibiting the pace of production thus far, with production ramping so much during the end of the quarter that puts them on pace to be able to manage 1,000 vehicles per week in terms of output.

By the end of Q1 2018, Tesla says it should be able to hit a rate of around 2,500 cars per week being produced, which will help it reach its 5,000 per week target hopefully by the end of Q2.

The company revealed that it delivered a total of 29,870 cars during the most recent quarter, including 15,200 Model S, 13,120 Model X and 1,550 Model 3. Full-year 2017 vehicle deliveries reached 101,312, 33 percent higher than 2016.