SAN FRANCISCO, June 22 (Reuters) – Tesla Inc’s (TSLA.O) new auto plants in Texas and Berlin are “losing billions of dollars” as they struggle to ramp up production due to battery shortages and port issues in China, Chief Executive Elon Musk said in an interview published Wednesday.

“Factories in Berlin and Austin are gigantic money furnaces right now. Okay? It’s really like a giant roar, which is the sound of burning money,” Musk said in an interview. with Tesla Owners of Silicon Valley, a recognized Tesla manager. club, in Austin, Texas, on May 31.

The club divided its interview with Musk into three parts, the last of which was published on Wednesday.

Musk said Tesla’s Texas plant is producing a “small” number of cars due to difficulties in ramping up production of its new “4680” batteries and that the tools to make its conventional 2170 batteries are “stranded in a port. in China”. read more “Everything is going to be settled very quickly, but it requires a lot of attention,” he said.

He said his Berlin plant is in a “slightly better position” because it started out using traditional 2170 batteries for cars built there.

SEARCHING TO “NOT GO BANKRUPT”

He said the COVID-19-related shutdowns in Shanghai “were very, very difficult.” The shutdown affected auto production not only at Tesla’s Shanghai plant, but also at its California plant, which uses some Chinese-made vehicle parts, he said. Read more

Tesla plans to suspend most production at its Shanghai factory in the first two weeks of July to work on a site upgrade to increase production, according to an internal memo seen by Reuters.

“The past two years have been an absolute nightmare of supply chain disruptions, one thing after another, and we’re not out of it yet,” Musk said.

Tesla’s main concern, he said, is “How can we keep the factories going so we can pay people and not go bankrupt?”

Musk said earlier this month that he had a “very bad feeling” about the economy and that the company needed to cut its workforce by about 10% and “suspend all hiring globally”. Earlier this week, he said a 10% reduction in Tesla’s salaried workforce would occur over three months. Read more

Earlier this year, Tesla began production at factories in Berlin and Texas, both of which are key to the growth ambitions of the leading electric carmaker.

Musk said he expects Tesla to begin production of its delayed Cybertruck electric pickup trucks in mid-2023.

Reporting by Hyunjoo Jin in San Francisco and Joe White in Detroit Editing by Leslie Adler and Matthew Lewis

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