Tesla’s recent automotive factories in Texas and Berlin are “losing billions of dollars” as they struggle to extend production due to a shortage of batteries and China port issues, Chief Executive Elon Musk said recently.
“Each Berlin and Austin factories are gigantic money furnaces at once. Okay? It’s really like a large roaring sound, which is the sound of cash on fire,” Musk said in an interview with Tesla Owners Silicon Valley, an official Tesla recognized club, in Austin, Texas, on May 31.
The club divided its interview with Musk into three parts, the last of which was released on Wednesday.
Musk said Tesla’s Texas factory produces a “tiny” variety of cars due to challenges in boosting production of its recent “4680” batteries and as tools to make its conventional 2170 batteries are “stuck in port in China.”
The Shanghai COVID shutdowns in China “were very, very difficult,” he said. The shutdown affected automotive production not only at Tesla’s Shanghai factory, but additionally at its California plant, which uses some vehicle parts made in China.
“The past two years have been an absolute nightmare of supply chain interruptions, one thing after one other, and we’re not out of it yet,” Musk said.
Tesla’s overwhelming concern, he said, is “How can we keep the factories operating so we are able to pay people and never go bankrupt?”
Musk said earlier this week that a ten% cut in salaried staff at Tesla will occur over three months. The world’s richest man also said a US recession was more likely than not.
Tesla earlier this 12 months began production on the factories in Berlin and Texas, each of that are critical to the expansion ambitions of the highest electric automotive maker.
Musk said he expected Tesla would start production of its Cybertruck electric pickup trucks, which has been delayed, in mid-2023.