Tesla extends Shanghai plant halt amid Covid wave

TESLA suspended car production at its Shanghai plant on Saturday, extending a planned eight-day production halt at its largest worldwide plant by car output, sources say.

The decision to extend the work halt comes as Tesla faces a wave of Covid-19 infections among its workers and suppliers. The temporary halt follows a recent slowdown in global demand for Tesla vehicles.

On Saturday, Tesla told some of its Shanghai employees that it would stop car production that day, a day earlier than originally planned. The company earlier told staff that production would resume on January 2.

A sources said that, while it wasn’t unusual for carmakers to pause work on some production lines during the Lunar New Year holiday and the summer, Tesla hadn’t traditionally halted all car production during the Christmas holidays.

Tesla had built up sufficient inventory and the production halt would not hurt its ability to fulfil orders, sources said.

During the northern summer, Tesla lifted the capacity of its Shanghai plant to more than 750,000 vehicles a year.

However, demand for its cars has been weaker than expected over the past two months, as China’s car market turned sluggish. Tesla buyers in China currently can receive their new vehicles within four weeks, compared with September when the wait was up to five times as long, according to the company’s website.

Tesla didn’t respond to a request for comment.

On Sunday, the company told the Global Times, a news outlet run by China’s Communist

Party, that it had planned for annual maintenance of its car-manufacturing lines in Shanghai this week, and that workers would take a break during the period.

Covid-19 infections have washed over China in recent weeks after Beijing eased its zero-Covid policies, taking down workers at carmakers and their suppliers, as well as dealership staff. Buyers have also stayed away from stores.