Tesla Bleeding Cash From Quality Issues

2016 Tesla Model X

It might seem like everything is going great for Tesla. After all, it’s just racked up a shocking number of Model 3 preorders, the Supercharger network keeps growing at a blinding pace and the media in general dotes on the California automaker. But there’s financial trouble brewing that could spell disaster.

One thing Tesla owners love to brag about is the top-notch customer service. Considering the company is the new kid on the block, it’s a wise move to stand out like that. It’s also an essential move, because quality issues have been rampant, like the retractable door handles on the Model S or the falcon wing doors on the Model X.

In an interview with Reuters recently, CEO Elon Musk said a big focus right now is minimizing quality control issues. It’s costing the company dearly. With a huge wave of Model 3s coming, having too many glitches in the cars could become a real nightmare in a hurry.

According to that Reuters report, Tesla spends far more on warranty costs than Ford or General Motors. Considering it only makes two vehicles at the moment, that’s not a good sign.

Really, what this shows is it’s not easy to get into the car manufacturing business. Tesla still hasn’t made it into the black, and that’s concerning investors. This is why if Apple’s smart, it will contract with an experienced automaker, if the rumors we’ve reported are true.