Musk says Tesla Berlin and Austin factories losing billions of dollars

“The previous two several years have been an certainly nightmare of offer chain disruptions, one thing after an additional, and we are not out of it but,” Tesla CEO Elon Musk stated.

Patrick T. Fallon | Reuters

Tesla’s newest car or truck factories in Texas and Berlin are getting rid of “billions of pounds appropriate now” as source chain disruptions hamper the electrical automobile giant’s capacity to ramp up manufacturing, chief executive Elon Musk explained in an job interview released this week.

“Both of those Berlin and Austin factories are gigantic income furnaces correct now. Ok? It should be like a large roaring sound which is the audio of dollars on fireplace,” Musk reported in the job interview with Tesla House owners Silicon Valley, which was recorded on May possibly 30 and posted Wednesday.

“Berlin and Austin are losing billions of pounds right now because there is certainly a ton of price and rarely any output. Obtaining Berlin and Austin purposeful and receiving Shanghai again in the saddle completely are overwhelmingly our issues. All the things else is a incredibly compact thing in essence.”

Musk said the Texas factory is “getting rid of crazy dollars” at the moment mainly because of problems ramping up output of autos with the so-known as 4680 battery, Tesla’s most current technologies. Meanwhile, the equipment to make autos for the conventional 2170 batteries are “trapped in a port in China.”

“Just been trying to maintain the factories functioning the previous pair years has been a very complicated matter, like source chain interruptions have been significant, like really significant,” Musk explained.

“The past two several years have been an certainly nightmare of offer chain disruptions, just one detail right after another, and we are not out of it still.”

In China, a resurgence of Covid in current months led to lockdowns in key cities this kind of as Shanghai, exactly where Tesla’s plant in the place is positioned. Tesla ideas to suspend most of the production at that manufacturing facility in the first two weeks of July to have out upgrades, Reuters claimed Wednesday.

Due to the fact the interview, Musk has introduced ideas to reduce Tesla’s salaried workforce by 10% in the upcoming three months. But the organization plans to enhance the amount of hourly staff members. Tesla’s layoffs would have an affect on all over 3.5% of its total workforce, Musk mentioned this week.

Despite the offer chain troubles, Tesla is however aiming to make 1.5 million autos this calendar year, Musk reported in April, while he cautioned that consumers facial area extended wait around periods for their autos.