Musk Says Tesla’s New Car Factories ‘Losing Billions Of Dollars’

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Tesla Inc’s (TSLA.O) new car factories in Texas and Berlin are “losing billions of dollars” as they struggle to increase production. This is because of a shortage of batteries and China port issues, Chief Executive Elon Musk says.

Tesla’s Texas factory produces a “tiny” number of cars because of challenges in boosting the production of its new “4680” batteries. And as tools to make its conventional 2170 batteries are “stuck in port in China, this is all going to get fixed real fast, but it requires a lot of attention.”
He said its Berlin factory is in a “slightly better position” because it started with using the traditional 2170 batteries for cars built there.

He said the COVID-19-related shutdowns in Shanghai were very difficult. The shutdown affected car production not only at Tesla’s Shanghai factory. But also at its California plant, which uses some vehicle parts made in China, he said.

Tesla plans to suspend most production at its Shanghai plant to work on an upgrade of the site to boost output. Tesla’s overwhelming concern, he said, is “How do we keep the factories operating so we can pay people and not go bankrupt?”

Tesla earlier this year, started production at the factories in Berlin and Texas. Both of which are critical to the growth ambitions of the top electric car maker. Musk said he expected Tesla would start production of its Cybertruck electric pickup trucks, which delays, in mid-2023.


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