Exclusive-Tesla halts production at Shanghai plant due to supply issues
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© Reuters. FILE PHOTO – Tesla China’s Model 3 cars are shown during a Tesla China delivery event in Shanghai on January 7, 2020. REUTERS/Aly SongSHANGHAI (Reuters). Tesla Inc halted production at Shanghai’s plant on Monday, according to two people who were familiar with the situation.
This suspension follows a three-week period in which the U.S. automaker had partially resumed production at Shanghai’s plant after a 22 day closure due to COVID-19 lockdown. It reflects the uncertainties and complexity of maintaining manufacturing as China fights the coronavirus.
The people speaking on the subject declined to identify themselves as it was private. They said that the uncertainty surrounding the availability of supply is not resolved. Also, Tesla (NASDAQ:), cannot resume production until then. Shanghai is currently in sixth week lockdown.
Aptiv (NYSE :), a wire harness producer, is among the Tesla suppliers currently facing difficulties. Aptiv had to stop shipping supplies to a plant that supplies General Motors (NYSE 🙂 because of infections discovered by its employees. Sources said Monday.
Tesla did not respond immediately to our request for comment.
The goal of the company, Reuters previously reported, was to boost output at Shanghai’s plant to 2,600 vehicles per day beginning May 16.
China’s most prominent COVID-19-related measures have led to the destruction of Tesla’s Shanghai factory. These actions, in addition to having a crimped vehicle sales, also caused disruptions.
China’s automobile association stated that April saw a drop in auto sales of 48% due to the zero-COVID lockdowns which closed factories and restricted traffic to showrooms. It also said spending was slowing down.
Shanghai authorities increased the security measures in Shanghai to extend the restrictions placed on commercial hub of 25million people a month earlier.
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