Tesla slashes Shanghai plant output over problem with parts

SHANGHAI: Tesla Inc has halted most of its production at its Shanghai plant because of problems securing parts for its electric vehicles, according to an internal memo seen by Reuters, the latest in a series of difficulties for the factory.

The automaker’s sales in China had already slumped by 98% in April from a month earlier, data released by the China Passenger Car Association (CPCA) showed on Tuesday, underscoring the hit from China’s strict covid- 19 lockdowns.

Shanghai is in its sixth week of an intensifying lockdown that has tested the ability of manufacturers to operate amid hard restrictions on the movement of people and materials.

Tesla planned to manufacture fewer than 200 vehicles at its factory in the city on Tuesday, according to the memo, far below the roughly 1,200 units per day it had ramped up to shortly after reopening on April 19 following a 22-day closure.

Tesla did not respond to a request for comment.

After reopening, the factory produced 10,757 vehicles by the end of April, selling 1,512 of them, the CPCA said.

That compared to 65,814 cars sold in March and marked the lowest sales tally since April 2020, four months after the factory started delivering Chinamade cars.

Tesla did not export any China-made Model 3s and Model

Ys from the Shanghai plant in April, the data showed.

Two people familiar with Tesla’s operations said earlier that the Shanghai plant suspended work on Monday after it faced difficulties procuring supplies.

The company had been aiming to increase output at the plant to 2,600 cars a day as soon as next week, Reuters reported previously.

Overall passenger car sales for China, the world’s largest auto market, dropped almost 36% in April from a year earlier, the CPCA said. However, sales of battery-electric vehicles and plug- in hybrids - a category China targets for incentives - rose more than 50%, boosted by particularly good performances by BYD and SAIC-GM-Wuling.