Tesla delivered about 17.9% lesser electric vehicles, hurt by Covid shut down in China
Tesla Inc. reportedly produced 17.9% fewer electric vehicles in its second-quarter than in the one before it, according to reports. The Covid-19 shutdown in China had a substantial impact on the company’s manufacturing and supply chain. Due to the lockdowns, Tesla’s manufacturing in Shanghai has been experiencing a number of problems for some time. Elon Musk’s electric vehicle company announced on Saturday, June 2, that it had delivered roughly 254,695 vehicles in the April to June timeframe as opposed to 310,048 in the prior quarter, ending a nearly two-year streak of record quarterly deliveries. Unfortunately, an unexpected increase in Covid-19 cases in China forced Tesla to briefly cease manufacturing at its Shanghai factory. This comeback even affected Chinese supplier facilities.
The manufacturer of electric vehicles increases production at its Shanghai factory as the lockdown gradually eases, which will help increase deliveries in the upcoming quarters. CEO Musk told executives last month that he had a “very awful feeling” about the economy. Furthermore, stating that 10% of Tesla’s employment had to be reduced. However, he reassured us that despite the ongoing supply-chain issues, there is still a high level of demand for Tesla vehicles.
Following Musk’s warning about significant inflationary pressure on logistics and raw materials, the EV company boosted pricing for some models in China and the US last month. According to a news release, June undoubtedly saw Tesla’s best monthly vehicle production rate in company history. Analysts predict that Tesla will record 295,078 vehicle deliveries for the April to June quarter based on Refinitiv data. Analysts had, however, reduced their projections because of the lockdown to 250,000.
Tesla has reported record deliveries every quarter since the third quarter of 2020, overcoming COVID-19 and other difficulties better than others. China also had a key role in the rapid rise in Tesla’s vehicle production. This was caused by the low-cost Shanghai facility, which produced roughly half of the total number of Tesla vehicles delivered in 2021.
The electric car manufacturer’s billionaire CEO predicted in April that second-quarter total vehicle production would be comparable to first-quarter totals. However, he recently claimed Tesla had a “very rough quarter” due to comparable difficulties in China. In addition, he said that the business’s new plants in Texas and Berlin were “gigantic money furnaces” since it was losing billions of dollars while trying to increase production.