SAN FRANCISCO, June 22 (Reuters) – Tesla Inc’s (TSLA.O) new automobile factories in Texas and Berlin are “dropping billions of {dollars}” as they wrestle to extend manufacturing due to a scarcity of batteries and China port points, Chief Government Elon Musk stated in an interview revealed on Wednesday.
“Each Berlin and Austin factories are gigantic cash furnaces proper now. Okay? It is actually like a large roaring sound, which is the sound of cash on hearth,” Musk stated in an interview with Tesla Homeowners of Silicon Valley, an official Tesla-recognized membership, in Austin, Texas, on Could 31.
The membership divided its interview with Musk into three components, the final of which was launched on Wednesday.
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Musk stated Tesla’s Texas manufacturing facility produces a “tiny” variety of automobiles due to challenges in boosting manufacturing of its new “4680” batteries and as instruments to make its typical 2170 batteries are “caught in port in China.” learn extra “That is all going to get fastened actual quick, but it surely requires a number of consideration,” he stated.
He stated its Berlin manufacturing facility is in a “barely higher place” as a result of it began with utilizing the standard 2170 batteries for automobiles constructed there.
SEEKING TO ‘NOT GO BANKRUPT’
The brand new Tesla manufacturing facility is seen in Austin, Texas, U.S. October 8, 2021. REUTERS/Tina Bellon/File Photograph
He stated the COVID-19-related shutdowns in Shanghai “have been very, very tough.” The shutdown affected automobile manufacturing not solely at Tesla’s Shanghai manufacturing facility, but additionally at its California plant, which makes use of some car components made in China, he stated. 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 positioning to spice up output, in response to 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 stated.
Tesla’s overwhelming concern, he stated, is “How will we preserve the factories working so we are able to pay folks and never go bankrupt?”
Musk stated early this month he had a “tremendous dangerous feeling” concerning the financial system and that the corporate wanted to chop employees by about 10% and “pause all hiring worldwide.” Earlier this week, he stated a ten% lower in salaried employees 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 vital to the expansion ambitions of the highest electrical automobile maker.
Musk stated he anticipated Tesla would begin manufacturing of its Cybertruck electrical pickup vans, which has been delayed, in mid-2023.
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Reporting by Hyunjoo Jin in San Francisco and Joe White in Detroit
Modifying by Leslie Adler and Matthew Lewis
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