According to Musk, new Tesla factories are losing billions of dollars

According to Musk, new Tesla factories are losing billions of dollars

Due to battery shortages and supply interruptions in China, Elon Musk claims that Tesla’s planned plants in Germany and the US are “losing billions of euros.”

The billionaire also referred to the factories in Austin, Texas, and Berlin as “gigantic money furnaces.”

Manufacturing has become more challenging as a result of COVID lockdowns in China this year, notably in Shanghai, where Tesla has a sizable facility.

Mr. Musk has been announcing job layoffs at the company in recent weeks.

Right now, the factories in Berlin and Austin are both enormous money furnaces. It sounds like money is on fire and makes a huge roaring noise, “said Mr. Musk, the CEO of the manufacturer of electric vehicles.

Since they were inaugurated earlier this year, the so-called gigafactories, according to Mr. Musk, have had difficulty increasing production.

Because some battery-related components were “trapped” at a Chinese port “with no one to actually transport them,” he said, Tesla’s Austin plant only presently produces a “small” number of cars.

In response to a spike in COVID-19 infections, Chinese authorities earlier this year shut down a number of major cities.

Tesla apparently stopped the majority of its manufacturing at its Shanghai “gigafactory” for weeks as a result of the closure, which Mr. Musk described as “very, very tough” for Tesla.

According to an internal memo obtained by the Reuters news agency, the site will once again be largely unavailable for two weeks next month for upgrade work.

According to the article, this is done to increase the site’s output and get it closer to the company’s objective of having the plant produce 22,000 cars every week.

After declaring earlier that he had a “very awful feeling” about the economy, Mr. Musk indicated this week that Tesla planned to reduce its global workforce by 3.5 percent.

BMW, a German automaker, announced on Thursday that formal production has started at its new $2.2 billion (£1.8 billion) facility in Shenyang, a city in northeastern China.

BMW claimed that the facility, which would be its third in China, will boost production there from 700,000 to 830,000 vehicles annually.

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