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Tesla’s Shanghai factory will be shut down for the first two weeks of July, shutting down Model Y production. Then, Model 3 production in China will be on hold for 20 days from July 18. But it is not the only factory of the American manufacturer which will have to take a break. Indeed, we learn that Germany is also affected.
According to TeslaMag, from July 11, 2022, the factory near Berlin will be stopped. According to “close” sources according to the established formula, this has to do with a ramp-up that is not going as planned. Tesla plans to double the pace of production from August. Tesla therefore prefers to shut down everything to correct “bugs” on the production line and thus be able to increase in daily volume.
The absence of production costs “a crazy dough”
Inaugurated by the boss himself on March 22, 2022, the German factory is very far from profitable and is even a money pit for the moment. There is an urgent need to increase the pace of the factory to stop burning so much cash. The year 2022 has obviously misfired in global production plans for Tesla and investors and the market must be reassured, as always.
The German factory has quality concerns. According to Bild, several vehicles had to be taken back after production to correct production defects. It is also expensive to do so. Except that some chassis are squarely put in the dumpster before being assembled. The “Jaberwock” Twitter account lists photos of the factory where you can see Tesla batteries good for the pestle. Some are already painted, some have doors installed, etc. A priori, we do not paint the “test chassis”.
Tesla’s Berlin factory seems to have sharply increased production of scrap car bodies
— jaberwock (@jaberwock2) June 15, 2022
“The factories in Berlin and Austin are losing billions of dollars right now, because there is a ton of expenses and very little production,” according to Elon Musk at the end of May.
Our opinion, by leblogauto.com
This isn’t the first time Musk and Tesla have faced quality and ramp-up concerns. Each time, Tesla got through the turbulence and then managed to ramp up production and improve the quality of the vehicles produced. What is quite surprising is that the lessons of the past do not seem to have been learned since several factories are struggling to pass an assembly milestone.
But let’s bet that Tesla and Musk will once again be able to get through it all. However, waiting times are getting longer. To date in France, a model 3 ordered now is scheduled for delivery in the first quarter of 2023. Less requested, the Model Y, which must be produced in the German factory, ordered now, would be delivered in the last quarter of 2022.
Tesla is going through a turbulent zone for several of its factories. The latest after China, Germany, which will have to be shut down to resolve quality issues.
The rise in cadence is at this price. There is no doubt that Tesla will be able to cope and ultimately achieve its 2022 objectives.