'We were huge idiots and didn't know what we were doing': Elon Musk blames Tesla's Model 3 production issues on being 'naive'

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Tesla CEO Elon Musk explained the company's production mistakes in an interview with Bloomberg.

• Tesla CEO Elon Musk said "we were huge idiots and didn't know what were doing" in an interview with Bloomberg, referencing Telsa's attempt to redesign the production process for the Model 3.
• Musk had hoped to make vehicle production faster and less expensive by significantly increasing the amount of automation Tesla used in its factories.
• But the company struggled to increase automation and production capacity at the same time after launching the Model 3 sedan.
• Musk said faulty robots and "naive" designers contributed to Tesla's production problems.

In an interview with Bloomberg, Tesla CEO Elon Musk said "we were huge idiots and didn't know what were doing" when attempting to redesign Tesla's production process for the Model 3.

Musk had hoped to make vehicle production faster and less expensive by significantly increasing the amount of automation Tesla used in its factories. But the company struggled to increase automation and production capacity at the same time after launching the Model 3 sedan.

Musk has previously said that Tesla tried to automate tasks that were better suited to humans, and that the company struggled with production bottlenecks caused by machines that didn't work as expected and had to be replaced by humans.

"A lot of the hoped-for automation was counterproductive," Musk told Bloomberg.

"We thought it would be good, but it was not good."

Musk also said some of the company's designers were "naive" about the manufacturing difficulties they would face and that, while the level of automation the company originally planned made sense in theory, it was difficult to implement.

"It sounds good on PowerPoint and it was terrible in reality," he said.

Tesla struggled to ramp up production for the Model 3 after it was launched in July 2017. The Model 3 is Tesla's first mass-market vehicle, designed to broaden the company's customer base beyond the luxury segment and increase the rate of electric vehicle adoption.

In May 2016, Musk said he estimated the company would make 100,000 to 200,000 Model 3s during the second half of 2017. Tesla made 2,685 Model 3 vehicles in 2017.

The company twice missed its self-imposed deadline to produce 5,000 Model 3s in a week, but hit that rate at the end of June. On July 2, the company said it had made 5,031 Model 3s during the final week of June and 28,578 during the second quarter, more than it had made in the prior three quarters combined.

Read Bloomberg's full interview.

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