Tesla's Got Production Issues. Acquiring This Automation Company Could Help.

Perbix has been supplying Tesla with automated production parts for three years.

Grow Your Business, Not Your Inbox

Stay informed and join our daily newsletter now!
Will be used in accordance with our Privacy Policy
Tesla's Got Production Issues. Acquiring This Automation Company Could Help.
Image credit: Tesla via engadget
Guest Writer
Writer
1 min read
A Note From The Editor
Tell our editors about your automotive buying plans in this 1-minute survey and get a free chapter download from The Tax and Legal Playbook as well as a $1 subscription to Entrepreneur magazine.
This story originally appeared on Engadget

Tesla is buying private machining company Perbix, possibly in a bid to mitigate the woes the car manufacturer announced last week, when it blamed a $619 million quarterly loss on production "bottlenecks." Perbix has been supplying Tesla with parts for nearly three years, but the acquisition will allow the company to produce more parts in-house, helping it fulfill its ambition to "build the machine that makes the machine."

Unfortunately, Tesla is struggling to build any machines at the moment, announcing alongside its earnings report that it won't be able to meet its target of producing 5,000 Model 3 sedans a week during 2017. It's not been revealed how much Tesla paid for Perbix, but financial filings show owner James S. Dudley was given more than $10 million worth of Tesla stock for the deal. Perbix is an expensive solution to Tesla's issues, then, but the cost pales in comparison to the sums Tesla will lose if it doesn't get on top of its production problems.

More from Entrepreneur

Get heaping discounts to books you love delivered straight to your inbox. We’ll feature a different book each week and share exclusive deals you won’t find anywhere else.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Create your business plan in half the time with twice the impact using Entrepreneur's BIZ PLANNING PLUS powered by LivePlan. Try risk free for 60 days.

Latest on Entrepreneur

Entrepreneur Media, Inc. values your privacy. In order to understand how people use our site generally, and to create more valuable experiences for you, we may collect data about your use of this site (both directly and through our partners). By continuing to use this site, you are agreeing to the use of that data. For more information on our data policies, please visit our Privacy Policy.