Musk says Tesla’s new automobile factories ‘dropping billions of {dollars}’

Musk says Tesla’s new automobile factories ‘dropping billions of {dollars}’

SAN FRANCISCO, June 22 (Reuters) – Tesla Inc’s (TSLA.O) new automobile factories in Texas and

SAN FRANCISCO, June 22 (Reuters) – Tesla Inc’s (TSLA.O) new automobile factories in Texas and Berlin are “dropping billions of {dollars}” as they battle to extend manufacturing due to a scarcity of batteries and China port points, Chief Govt Elon Musk mentioned in an interview printed on Wednesday.

“Each Berlin and Austin factories are gigantic cash furnaces proper now. Okay? It is actually like an enormous roaring sound, which is the sound of cash on fireplace,” Musk mentioned in an interview with Tesla House owners of Silicon Valley, an official Tesla-recognized membership, in Austin, Texas, on Might 31.

The membership divided its interview with Musk into three elements, the final of which was launched on Wednesday.

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Musk mentioned Tesla’s Texas manufacturing facility produces a “tiny” variety of vehicles due to challenges in boosting manufacturing of its new “4680” batteries and as instruments to make its standard 2170 batteries are “caught in port in China.” learn extra “That is all going to get fastened actual quick, but it surely requires plenty of consideration,” he mentioned.

He mentioned its Berlin manufacturing facility is in a “barely higher place” as a result of it began with utilizing the normal 2170 batteries for vehicles constructed there.

SEEKING TO ‘NOT GO BANKRUPT’

He mentioned the COVID-19-related shutdowns in Shanghai “had been very, very tough.” The shutdown affected automobile manufacturing not solely at Tesla’s Shanghai manufacturing facility, but in addition at its California plant, which makes use of some automobile elements made in China, he mentioned. learn extra

Tesla plans to droop most manufacturing at its Shanghai plant within the first two weeks of July to work on an improve of the location to spice up output, based on an inner memo seen by Reuters.

“The previous two years have been an absolute nightmare of provide chain interruptions, one factor after one other, and we’re not out of it but,” Musk mentioned.

Tesla’s overwhelming concern, he mentioned, is “How can we hold the factories working so we are able to pay individuals and never go bankrupt?”

Musk mentioned early this month he had a “tremendous dangerous feeling” concerning the economic system and that the corporate wanted to chop workers by about 10% and “pause all hiring worldwide.” Earlier this week, he mentioned a ten% reduce in salaried workers at Tesla will happen over three months. learn extra

Tesla earlier this yr began manufacturing on the factories in Berlin and Texas, each of that are crucial to the expansion ambitions of the highest electrical automobile maker.

Musk mentioned he anticipated Tesla would begin manufacturing of its Cybertruck electrical pickup vehicles, which has been delayed, in mid-2023.

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Reporting by Hyunjoo Jin in San Francisco and Joe White in Detroit
Enhancing by Leslie Adler and Matthew Lewis

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