“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 company told CNBC.
The carmaker's shares declined 2.3 percent on Monday after opening up 5 percent at the beginning of that day’s session.
Reuters also reported on Tuesdaythat Tesla shifted workers from other departments including the Model S production line to meet its Model 3 production target.
Goldman Sachs was not impressed with the company’s announcement and reiterated its sell rating for Tesla shares, noting net Model 3 reservations declined to 420,000 from 455,000 last year.
“Model 3 deliveries did miss our bearish estimates and we see the incremental color on Model 3 net reservations (where the company showed its first declining data point) as incrementally negative,” analyst David Tamberrino said in a note to clients Tuesday.
Tamberrino reiterated his $195 six-month price target for Tesla shares, representing 42 percent downside to Monday’s close.
One Wall Street analyst believes Tesla shares will drop further when the company reports its second-quarter earnings.
“Given the softer overall trend to deliveries and implied negative read-across to 2Q earnings and cash flow, we expect a negative reaction in TSLA shares,” J.P. Morgan analyst Ryan Brinkman said a note to clients Tuesday.
Brinkman reiterated his underweight rating and $180 price target for the carmaker’s shares.