Elon Musk tells Tesla staff to cut delivery costs to help customers' cars arrive on time, amid shipping delays, report says

• Tesla CEO Elon Musk urged employees to cut the cost of delivering vehicles, CNBC reported.
• In a company-wide email, Musk said Tesla should shift away from spending heavily on expedite fees.

Elon Musk urged Tesla staff to focus on cutting 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 focus this quarter should be on minimizing cost of deliveries rather than spending heavily on expedite fees."

It added: "What has happened historically is that we sprint like crazy at end of quarter to maximize deliveries, but then deliveries drop massively in the first few weeks of the next quarter."

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

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

Musk has previously acknowledged Tesla's delivery problem as "logistics hell," per Reuters.

Customers sometimes suffered months-long delivery delays. In August, Tesla Model S and Model Y customers complained they were waiting up to four months to receive their cars, Insider's Isobel Hamilton reported.

In 2019, the EV maker announced the purchase of its own auto-hauling trucking capacity in an effort to deliver cars more quickly and improve the company's logistics systems, Insider's Rachel Premack reported.

Tesla move to focus on slashing 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.

Per CNBC, in Friday's email, Musk lamented the fact that, effectively, Tesla wouldn't have delivered any extra cars over a six-month period but "would have spent a lot of money and burned ourselves out to accelerate deliveries in the last two weeks of each quarter."

The email added: "This is nonetheless the right time to start reducing the size of the wave in favor of a steadier and more efficient pace of deliveries."