Elon Musk complains that new Tesla factories lose billions of {dollars}: “Berlin and Texas factories are large money-burning furnaces”

New automobile factories of Tesla Inc. (TSLA.O) in Texas and Berlin “lose billions of {dollars}” as they try to extend manufacturing because of lack of batteries and port issues in China, CEO Elon Musk stated in an interview on Wednesday, based on Reuters.

Elon Musk complains that new Tesla factories lose billions of {dollars}: “Berlin and Texas factories are large furnaces for burning cash” – Profimedia Photos

“Each the Berlin and Austin factories are large kilns of cash proper now. It is actually like an enormous roar, which is the sound of cash on fireplace. “ Musk stated in a three-part interview, the newest of which was revealed Wednesday.

Musk stated Texas’ Tesla plant produces a “tiny” variety of vehicles due to challenges in growing manufacturing of its new “4680” batteries and since the instruments for making its standard 2170 batteries are “caught in port in China.”

“All this will probably be resolved in a short time, nevertheless it requires numerous consideration”he stated.

Musk stated his manufacturing unit in Berlin was in a “barely higher place” because it started utilizing conventional 2170 batteries for vehicles constructed there. Elon Musk additionally stated that the stops associated to COVID-19 in Shanghai “had been very, very troublesome”.

The pandemic affected automobile manufacturing in Shanghai

The shutdown affected automobile manufacturing not solely on the Tesla plant in Shanghai, but additionally at its manufacturing unit in California, which makes use of some elements for autos made in China, he stated.

Tesla plans to droop most of its manufacturing at its Shanghai plant within the first two weeks of July to work on modernizing the location to extend manufacturing, based on an inner memorandum consulted by Reuters.

“The final two years have been an absolute nightmare of provide chain disruptions, one factor after one other, and we nonetheless have not gotten out of it.” Musk stated.

Tesla’s overwhelming concern, he stated, is “how can we hold factories working so we are able to pay folks and never go bankrupt?”

Tesla will scale back workers by about 10%

Musk stated earlier this month that he had a “tremendous unhealthy feeling” in regards to the economic system and that the corporate ought to minimize workers by about 10% and “minimize off all employment worldwide.”

Earlier this week, he stated a ten% discount in Tesla’s workers would happen over three months.

Earlier this yr, Tesla started manufacturing at factories in Berlin and Texas, each of that are crucial to the expansion ambitions of the world’s largest electrical carmaker.

Musk stated Tesla expects manufacturing of its Cybertruck electrical pickup truck to start, which was postponed to mid-2023.

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