News dropped this week that Tesla Motors Inc. (NASDAQ:TSLA) is set on buying Grohmann Engineering. Reports say the German engineering firm will help get the EV company closer to hitting its production goals. Tesla is on a steady path to reshape the automotive industry, and it’s doing a pretty good job so far. Globally, the company’s stylish and award-winning luxury EVs continue to gather appeal. Reports in the U.S. highlight its flagship Model S as the top seller in its class. However, the electric car giant also has a reputation for setting ambitious goals ansd delivering on them months, or even years, later.
Doubt over Tesla
The Model X is a prime example this. Tesla’s luxury SUV only started shipping late last year, around two years after it was first proposed to launch. And even though the electric-powered, sports utility car with falcon-wing doors was probably worth the wait, the company is plagued with moments where it oversold its capabilities.
The latest in scoff-worthy assurances from Tesla is its goal to produce 500,000 EVs in 2018. Analysts were hardly convinced when the company first set that target for 2020. But earlier this year when chief exec Elon Musk said it can be done two years sooner, Wall Street had none of it.
However, the claim got a some added substance this Tuesday when Tesla said it will adopt Germany’s Grohmann Engineering. The manufacturing firm will form the building blocks for Tesla Advanced Automation Germany.
“After increasing our output to 500,000 cars per year by 2018, we began searching for the best engineering talent in automated manufacturing systems,” the company wrote on November 8. “Today we are excited to announce that Tesla has entered into an agreement to acquire Grohmann Engineering, a world-renowned engineering company in Prim, Germany.” Under the EV giant, the acquired firm will be known as Tesla Grohmann Engineering.
Musk’s car-making machine
“[T]he machine that builds the machine.” This is how Tesla chooses to describe the business model it is currently working on. The approach recognizes the company’s series of plants as a tool in and of itself. According to Musk, the factories rushing to get the Model 3 on the road can be thought of as version 0.5 of this machine-building machine. The full version should be up and running around 2018 and we can be sure Grohmann Engineering will be a part of it.
Klaus Grohmann, founder of the soon-to-be-adopted firm, will still hold the lead at Grohmann Engineering. Only now the German company will be dedicated to making key parts of Tesla Motor’s automated production systems. Adding to the German job market, the next 2 years should see the makers of the Model S hire over 1,000 technicians and engineering.
Jumping to 500,000 cars by 2018 is going to require a great effort from Tesla. The latest yearly report puts it a 100,000 EVs right now, meaning the firm has to grow production by 400,000 in 2 years. But Tesla has seen significant spikes in its production so far, despite missing a few goals along the way. The current boost will help put the company on track to forking out its mass-market Model 3 concept by the end of next year.
Tesla Motors Inc. (NASDAQ:TSLA)’s latest blog post points out that production has risen 400 percent at its Fremont Plant. This took place over 4 years and the acquisition of Grohmann will see that rate accelerate even more.