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Tesla Compared To Theranos After Musk Halted Critical Brake Test To Boost Output

• by Tyler Durden

"Every car we build goes through rigorous quality checks and must meet exacting specifications, including brake tests. To be extremely clear, we drive *every* Model 3 on our test track to verify braking, torque, squeal and rattle. There are no exceptions."

The response did not explain why the test was necessary in the first place. It certainly did not help the shares.

One of the biggest mysteries to emerge from Tesla's mad dash scramble over the past week to hit its 5,000 Model 3 production quota in a week, was the question: what is a "factory gated" model and why are so many of the Model 3s produced by Musk not quite "production quality."

In addressing this question yesterday, Vertical Group's Gordon Johnson offered this explanation:

TSLA mentioned that it reached 5,031 Model 3 cars of "factory gated" production in the last week of June; while the company said it has used the "factory gated" terminology all along, we were not able to find this term in any SEC filings or public transcripts; however, looking to Linkedin, it seems "factory gated" may mean cars that require further testing and quality inspection upon leaving the factory floor (Exhibit 1) – this would mean these cars are likely not "full production vehicles" in the traditional sense of auto industry terminology;

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