Tesla sells 200,000th vehicle, starting phaseout of federal tax credits

The Tesla showroom in Newport Beach California. Bloomberg

The Tesla showroom in Newport Beach California. Bloomberg

Opting for the Model 3 dual-motor auto would add $5000 [£3800] to the $35,000 [£26,650] starting price of the entry-level Model 3 in the US, Musk said, and would allow the vehicle to reach 0-60mph in 4.5sec, with a 140mph top speed and 310-mile driving range.

Tesla CEO Elon Musk explained the company's production mistakes in an interview with Bloomberg. So far, the company is only building high-end versions of the Model 3 for significantly higher prices.

Along with the new Model 3 orders placed from here on out, Tesla has a backlog of about 400,000 reservation holders as it continues to ramp up production. Musk and his team made a big bet that automation would help Telsa make more cars in a single month than it ever had before, only to have robots repeatedly fail, forcing the company to halt the entire production process to fix the problem.

Now, Tesla's production process includes areas that are completely automated, areas where employees work with no automation at all, and areas where humans and robots work together, he told Bloomberg.

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

Musk also said that some of the company's designers were "naive" about the manufacturing difficulties they would face and that the company's plans for increased automation made sense in theory but were hard to implement.

Tesla has struggled to ramp up production for the Model 3, which it launched in July of past year. Since the vehicle reservations exceeded the company's estimates, Tesla has embarked on an initiative to anti-sell the compact electric auto.

Tesla CEO Elon Musk has promised to deliver an entry-level Model 3 with a range of 220 miles per charge and a starting price of $35,000 one day, but that configuration can't be ordered yet and the Tesla website says it will be six to nine months before it will be available.

For the first time since it started taking reservations for its new "affordable" Model 3, Tesla has opened up the car's configurator to the public.

The company twice missed its self-imposed deadline to produce 5,000 Model 3s in a week, though it hit that rate at the end of June.