Exclusive-Tesla to maintain production in modernized Shanghai factory without limiting sources

Exclusive-Tesla to maintain production in modernized Shanghai factory without limiting sources

SHANGHAI (Reuters) – Tesla Corp (Nasdaq) plans to suspend production at its Shanghai plant at about 93 percent of capacity through the end of the year despite a recent update, two people familiar with the matter said. American electric car maker.

Since opening the plant in its second largest market in late 2019, Tesla has sought to bring the facility in the China mall to full capacity, and recently upgraded its weekly production by 30% to a maximum of 22,000 vehicles.

The sources, who spoke on condition of anonymity because the matter is not public, did not give a reason for the decision not to fully operate the plant, although one said the number was lower than expected.

Tesla did not immediately respond to a request for comment on Tuesday.

However, the company’s move comes at a time of increased competition from domestic electric vehicle (EV) manufacturers in a sharply weakened economy, with consumption falling amid severe COVID-19 restrictions.

The upgraded plant could produce 14,000 Model Y and 8,000 Model 3. Tesla has sought to keep them operating at full capacity, except during the upgrade and a two-month citywide COVID-19 shutdown this year, sources added.

The sources said that Tesla now plans to produce 20,500 units per week for the rest of the year, for a total of 13,000 Model Y and 7,500 Model 3s.

Figures from the China Passenger Car Association showed Tesla’s sales in China jumped nearly 60% in the first eight months of this year.

But this pace is much weaker than the overall market for new energy vehicles during the same period, which saw sales more than double.

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Since last month, the company has reduced delivery waiting times in China at least four times, to at least a week now, along with offering a discount of 8,000 yuan ($1,100) to Tesla insurance buyers who receive between September 16-30. .

Analysts said the moves were aimed at securing more orders.

In the next few months, increased competition is expected to intensify the price war among electric car makers, said Shi Jie, an analyst at China Merchants Bank International.

Tesla sold 60% of its cars made in China in the domestic market during the first eight months, and exported the rest to overseas markets such as Australia, Europe, Japan and Singapore.

(dollar = 7.1623 renminbi)

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