"Building cars isn't nearly as big a problem for them as delivering them and servicing them. They thought that other automakers were pissing away a big chunk of markup by selling wholesale to franchised dealerships. They were wrong.
When Toyota dumps several million cars on dealerships at the beginning of the model year, they become the dealership's problem. The cars go on trucks that are filled to capacity and only going to one place, which is by far more efficient than delivering cars to customers one by one, straight from the factory (which also means that they have to be PDI'd at the factory), Toyota gets paid and aside from the end of the year when they offer incentives to move the last remaining models, they are free and clear of them.
When the warranty claims come (and Tesla has more than double the national average in both frequency and dollars, BTW), any dealership, anywhere can handle them, Toyota doesn't need to arrange transport for an entire car to some service center that might be a couple states away that Tesla both paid to build and pays to keep open. Toyota just has to pay the dealership for it's labor, reimburse them for parts they already sold to them at a markup, and that's it. Tesla's business model is fundamentally flawed, cars are not iPhones, and Elon still has yet to admit that to himself."
