Tesla Halts Model 3 Production at its Shanghai Factory

Tesla Halts Model 3 Production at its Shanghai Factory

Author: FutureCar Staff    

With the coronavirus pandemic shutting down auto production worldwide, Tesla's California factory has been idle since March 23, leaving its new Shanghai factory as the sole facility building cars for the electric automaker.

However, Bloomberg and Chinese tech news site 36kr reported that Tesla has suspended production in China, according to people familiar with the matter. The company's Shanghai factory is currently building the Model 3 sedan for the Chinese market and is the company's only overseas factory. 

Tesla's plant was closed for China's traditional five-day Labor Day Holiday, which began on May 1, but workers were scheduled to return to work on Wednesday May 6. 

Tesla informed factory workers who were supposed to return to work Wednesday that their holiday break would be extended until at least May 9, according to the people, who asked not to be identified because the information is not public.

The suspension of the factory brings to a halt all of Tesla's electric vehicle production worldwide. 

 Tesla said in a statement that its Shanghai factory is conducting normal maintenance work and that the company made use of the Labor Day holidays to conduct production-line adjustments, without providing additional details. However that statement conflicts with people at the plant that spoke with Chinese media outlet 36kr.

The technology news site reported that the shutdown was due to parts shortages for the Model 3. Tesla is also experiencing problems with a crucial piece of manufacturing equipment that's being repaired, according to the people.

China's economy is slowly getting back to normal as no new coronavirus cases are being reported. The region around Wuhan, where the virus is believed to have originated, is home to much of China auto production.

Demand for the Model 3 remains high in China, so keeping the plant operational is a priority for Tesla. The automaker was also among the first to resume production, which helped boost Tesla's China sales in March. Tesla also has plans to build the new Model Y crossover in China.

Tesla started delivering the first China-made Model 3s to customers in late December.

In the U.S., Tesla's Fremont, California factory will remain closed until the San Francisco Bay Area's shelter-in-place orders are lifted, which will likely last for the rest of the month as new coronavirus cases continue to rise in the U.S.

FutureCar Staff
FutureCar Staff
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