Tesla Builds Its Own Car Carriers to Keep Up With Demand

By Douglas A. McIntyre Updated Jan 11, 5:24PM EST · Published Sep 25, 6:35AM EDT

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Tesla Inc. (NASDAQ: TSLA) had problems as it tried to reach its goal to manufacture 5,000 new Model 3 cars a week as recently as two months ago. It has hit and passed that target, which is among the reasons it cannot get some Model 3 vehicles to customers. Too many cars and too few car carriers.

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Tesla has decided the problem is severe enough it has started to make its own carriers. Founder and CEO Elon Musk tweeted:

Apologies, we’re upgrading our logistics system, but running into an extreme shortage of car carrier trailers. Started building our own car carriers this weekend to alleviate load.

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It is a radical solution, but the company needs one because some customers are tired of the wait for their Model 3 cars. Dissatisfied customers may elect to cancel their orders and go somewhere else.

Car carriers are almost certainly not cheap to build since they are large trucks with special storage meant to move cars from a factory to dealers or other locations. The need for a fleet of carriers makes the solution all the more complex, and expensive.

The decision is another example of how Tesla paints itself into corners. First, it cannot make enough cars, and Musk needs to sleep on a factory floor to help speed up the assembly line. Then, someone did not make proper logistics plans to move these cars. Tesla and Musk have not disclosed how deep the problem is.

Could Tesla actually have planned in advance? It has lost a number of key executives in the past several months. Maybe one of them was in charge of the carriers.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.