Tesla Inc’s new automotive factories in Texas and Berlin are “shedding billions of {dollars}” as they battle to extend manufacturing due to a scarcity of batteries and China port points, Chief Govt Elon Musk mentioned in an interview revealed on Wednesday.

“Each Berlin and Austin factories are gigantic cash furnaces proper now. Okay? It is actually like a large roaring sound, which is the sound of cash on fireplace,” Musk mentioned in an interview with Tesla House owners of Silicon Valley, an official Tesla-recognized membership, in Austin, Texas, on Could 31.

The membership divided its interview with Musk into three components, the final of which was launched on Wednesday.

Musk mentioned Tesla’s Texas manufacturing facility produces a “tiny” variety of automobiles due to challenges in boosting manufacturing of its new “4680” batteries and as instruments to make its standard 2170 batteries are “caught in port in China.” “That is all going to get mounted actual quick, nevertheless it requires a whole lot of consideration,” he mentioned.

He mentioned its Berlin manufacturing facility is in a “barely higher place” as a result of it began with utilizing the normal 2170 batteries for automobiles constructed there.

SEEKING TO ‘NOT GO BANKRUPT’

He mentioned the COVID-19-related shutdowns in Shanghai “had been very, very troublesome.” The shutdown affected automotive manufacturing not solely at Tesla’s Shanghai manufacturing facility, but additionally at its California plant, which makes use of some automobile components made in China, he mentioned.

Tesla plans to droop most manufacturing at its Shanghai plant within the first two weeks of July to work on an improve of the positioning to spice up output, in accordance with an inside memo seen by Reuters.

“The previous two years have been an absolute nightmare of provide chain interruptions, one factor after one other, and we’re not out of it but,” Musk mentioned.

Tesla’s overwhelming concern, he mentioned, is “How can we maintain the factories working so we are able to pay individuals and never go bankrupt?”

Musk mentioned early this month he had a “tremendous unhealthy feeling” concerning the financial system and that the corporate wanted to chop employees by about 10% and “pause all hiring worldwide.” Earlier this week, he mentioned a ten% minimize in salaried employees at Tesla will happen over three months. 

Tesla earlier this 12 months began manufacturing on the factories in Berlin and Texas, each of that are vital to the expansion ambitions of the highest electrical automotive maker.

Musk mentioned he anticipated Tesla would begin manufacturing of its Cybertruck electrical pickup vans, which has been delayed, in mid-2023.

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