Tesla Service Center Expansion Stuck In "Infrastructure Hell"

Elon Musk said Tesla would fill its North American service gaps in three to six months. Three months later, not a single US service center has opened.

Tesla

After a year of "production hell," Tesla's higher-volume Model 3 moved on to creating a new problem for the company last summer: sales and service infrastructure hell. Even before the Model 3 launched in the summer of 2017, media reports have claimed that Tesla was preparing for its Model 3 growth by "drastically" increasing its service footprint to handle higher volumes. But by the time Tesla exited "production hell" complaints about service were more prevalent than ever, forcing Elon Musk to admit in October that he

"Just reviewed Tesla’s service locations in North America & realized we have major gaps in geographic coverage! Sorry for this foolish oversight. Tesla will aim to cover all regions of NA (not just big cities) within 3 to 6 months."

Having passed the three-month mark since that Tweet, I thought I would look into Musk's promised North American service footprint expansion and the reality seems to reflect Bertel Schmitt's warning from way back in 2016: expanding physical locations is expensive, complicated and time-consuming. At the time that Musk made that announcement, Electrek reported that Tesla operated 78 service centers across the US and today Tesla's website lists... 78 service centers across the US. With three months left until the outside limit of Musk's deadline to fix this "foolish oversight," dissatisfaction with Tesla's service slowly reaching a boil, and a demands on Tesla's cash (including an upcoming $920 million convertible bond repayment) continuing to grow, is relief anywhere in sight?

In order to get a sense of Tesla's progress on service center construction, I performed a non-comprehensive survey of the locations where new service center planning/permitting has been reported and tried to get a sense of progress at each. What I found didn't inspire confidence that Tesla will be able to meaningfully turn around its service shortfall on Musk's timeline, making it another candidate for his growing collection of wildly overoptimistic timelines. However, it must be made clear: this is in no way a comprehensive or scientific survey of Tesla's planned and under-construction service centers, but rather a quick initial survey of some of the most talked-about locations. I encourage others to build on this research and work toward a more complete picture of the situation.

Omaha, Nebraska. Tesla has said that a service center would be "coming soon" to Omaha since 2014, where owners currently have to drive to Kansas City for service. Musk said in October that Tesla was aiming to open the long-awaited Omaha service center "in a few months," but I couldn't find any evidence of permits, construction or anything else that might indicate that a service center is coming soon. As with several other service center locations, Tesla seems to be trying to get local laws changed before making investments and a new version of a bill that would allow it to operate company stores was recently re-introduced to the Nebraska legislature

Lawrenceville, New Jersey. In April the Lawrenceville Township Planning Board approved a new Tesla sales and service facility that appeared to be in near-turnkey condition, which Tesla was said to have obtained a ten year lease for [PDF]. Subsequent reports posted to the TeslaMotorsClub forum show that progress on that facility has halted, and it appears that the company's representative for that location has left the company. Tesla is lobbying the New Jersey legislature to allow it to open more than the four retail locations it currently has, which suggests that it will only open the Lawrenceville service location if and when it can include a retail operation there.

Superior, Colorado. A new Tesla service center was approved in March and is currently under construction in Superior, Colorado, located strategically between Denver and Boulder. As of September the site was little more than a concrete pad, according to TMC posts, and the latest posted photos, from December 5th, show good progress. Of all the locations surveyed, this one seems most likely to open by the end of Musk's timeline.

 Peabody, Massachussets. Tesla applied for a special permit from the Peabody City Council in March of last year, declaring its intention to create a new sales and service center to a former Sears Automotive Center. According to a presentation at a subsequent planning board meeting in May [PDF], the project will require considerable work and the estimated time frame is approximately two years "depending on approvals." In December Tesla posted four service-related job openings for Peabody, but as of December 19th it had only applied for an electrical permit which at that time was pending approval.

Knoxville, Tennessee. Tesla proposed bringing a service center to another abandoned Sears Auto Center in Knoxville back in June, and in December Knoxville was one of the cities Musk mentioned would get a new service center in 2019. As of mid-December, the Sears was still holding going-out-of-business sales and had not yet vacated the premises according to a report on TMC. The only Tesla service job listed for Tennessee was for a mobile service position.

Westport, Connecticut. After more than a year spent trying to secure approval and incentives for a new service center on Saugatuck Ave, Tesla pulled the plug on that location last July after neighbors opposed the development. Now Tesla appears to be on track to develop a new service center in Wesport, at the site of a former classic car showroom, with the city's planning and zoning commission approving Tesla's plans in mid-December. The most recent available permits for the parcel date back to 2016.

Columbus, Ohio. Tesla plans to vacate its Easton Mall showroom for a Shake Shack, and move to a much larger combined sales/service center at a former Hhgregg building. According to one report on TMC the new facility was supposed to open in the last week of December, but the City of Columbus permit site shows ongoing inspections. Inspections of rough and final structural work resulted in non-approvals on January 16 and 18th (notes in the latter suggest fire suppression was not complete, and much of the building hadn't been inspected) and a final inspection is scheduled for the 28th. New plan revisions were submitted to the City of Columbus on the 25th, suggesting work may be ongoing for some time.

New Orleans, Louisiana. Like Omaha, Tesla has been promising a service center in the Big Easy since 2014 but did not obtain permits to begin work on a specific site until July of last year. As of the end of September the building had been painted, but no other progress was evident according to reports on TMC. A report from the end of December suggested it was still not open, and the only Tesla service job posted for the state of Louisiana is for a mobile service technician. Strangely, the still-unopened New Orleans service center is the only location listed as "coming soon" on Tesla's service center map.

Berkeley, California. According to TMC reports, a new service center in Berkeley appeared to be ready to open some time in mid-December but as of January 8th visitors were being told that permits wouldn't be ready for another three weeks.

Farmington Hills, Michigan. Blueprints for a service center in Farmington Hills, MI were posted on Reddit about a year ago and a permit appeared to be posted at the likely location last April. No subsequent reports could be found, and Michigan owners report that they have had to have cars shipped to Ohio for service, or rely on Tesla's mobile service fleet.

 Smithtown/Nesconset, New York. Tesla said last year that it would open a Nesconset/Smithtown service/sales center by the end of 2018, but there have been no reports of it opening. In early January, Tesla listed four service job openings for Smithtown, suggesting the service center could be on track to open by the end of Musk's projected timeframe. 

Pomona, California. What appeared to be a new service center opened in Pomona, California in October according to TMC reports but it turns out to be something a bit different. Not listed as an official Tesla service center, Pomona instead appears to be a Tesla Body Repair Support Center. Photos show a facility that is far more spartan than a typical Tesla service facility.

Carlsbad, California. A service center is planned for Carlsbad, California according to reports at TMC and as of January 18th construction is ongoing. Tesla owners report that a temporary service center has been opened in Oceanside until the Carlsbad facility is complete, but that it doesn't have operational vehicle lifts. A construction supervisor reportedly told a visitor that the new Carslbad service center was hoping to be done by April which means it might have a shot at opening within Musk's timeline.

We asked Tesla to comment on its service center expansion plans, and Musk's three to six month timeline but requests were not immediately acknowledged.