Tesla is shutting down production at the Gigafactory in Shanghai for two days this week amid a spike in COVID-19 cases in China, though the company hasn’t confirmed that was the cause.
China has strict containment plans that include mass testing and lockdowns, which served the country well last year in limiting the spread of the virus.
But in less than three months of 2022, there are already more cases in the country than in all of last year.
The number of new daily cases is now reaching a high not seen since the first wave of the virus in 2020.
This prompted a lockdown in some regions and mass testing to try and limit distribution.
In this context, Tesla announced to employees and suppliers that it will close production at the Gigafactory in Shanghai on Wednesday and Thursday (via Reuters):
“According to a notice sent out domestically and to suppliers, electric vehicle giant Tesla is suspending production at its Shanghai plant for two days as China tightens COVID restrictions to curb the country’s latest outbreak.
The Shanghai plant is running around the clock, and Tesla suppliers and employees, in a notice reviewed by Reuters, said on Wednesday that production would be suspended for Wednesday and Thursday.
Gigafactory Shanghai is critical to Tesla’s operations as the plant became the largest in terms of production last year and exported many Model 3 and Model Y vehicles to European markets.
Tesla hasn’t confirmed that the shutdown was due to a spike in COVID-19 cases or increased restrictions put in place to contain it, but we’ve seen several similar factory shutdowns over the past few days.
Both Toyota and Volkswagen were forced to recently announce similar shutdowns due to the pandemic.
Supply chain restrictions could also be the reason for the shutdown, as was the case recently.
Recently, Tesla has been producing about 60,000 vehicles per month at the Gigafactory in Shanghai, or about 2,000 vehicles per day. So even just two days of downtime can have a significant impact on productivity and lead to even longer delivery times.
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