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Musk says Tesla’s factories in Berlin and Texas are ‘gigantic cash furnaces’

“The previous two years have been a fully nightmare of provide chain disruptions, one factor after one other, and we’re not out of it but,” Tesla CEO Elon Musk mentioned.

Patrick T. Fallon | Reuters

Tesla’s latest automotive factories in Texas and Berlin are dropping “billions of {dollars} proper now” as provide chain disruptions hamper the electrical automobile big’s means to ramp up manufacturing, chief govt Elon Musk mentioned in an interview revealed Wednesday.

“Each Berlin and Austin factories are gigantic cash furnaces proper now. Okay? It needs to be like an enormous roaring sound which is the sound of cash on fireplace,” Musk mentioned within the interview with Tesla House owners Silicon Valley, which was recorded on Could 30.

“Berlin and Austin are dropping billions of {dollars} proper now as a result of there is a ton of expense and hardly any output. Getting Berlin and Austin useful and getting Shanghai again within the saddle totally are overwhelmingly our considerations. Every part else is a really small factor principally.”

Musk mentioned that the Texas manufacturing unit is “dropping insane cash” in the meanwhile due to troubles ramping up manufacturing of vehicles with the so-called 4680 battery, Tesla’s newest know-how. In the meantime, the instruments to make vehicles for the normal 2170 batteries are “caught in a port in China.”

“Simply been making an attempt to maintain the factories working the final couple years has been a really tough factor, like provide chain interruptions have been extreme, like extraordinarily extreme,” Musk mentioned.

“The previous two years have been a fully nightmare of provide chain disruptions, one factor after one other, and we’re not out of it but.”

In China, a resurgence of Covid in current weeks led to lockdowns in main cities reminiscent of Shanghai, the place Tesla’s plant within the nation is. Tesla plans to droop many of the manufacturing at that manufacturing unit within the first two weeks of July to hold out upgrades, Reuters reported on Wednesday.

For the reason that interview, Musk has introduced plans to scale back Tesla’s salaried workforce by 10% within the subsequent three months. However the firm plans to extend the variety of hourly workers. Tesla’s layoffs would have an effect on round 3.5% of its total workforce, Musk mentioned this week.

Regardless of the availability chain points, Tesla continues to be aiming to provide 1.5 million vehicles this yr, Musk mentioned in April, although he cautioned that clients face lengthy wait instances for his or her automobiles.

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