Musk Says New Tesla (TSLA) Factories Lose Billions of Dollars Ahead of Ramp Up

June 22, 2022 5:12 PM EDT

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According to Bloomberg News, Elon Musk stated that Tesla, Inc. (NASDAQ: TSLA) is losing “billions of dollars” from its new plants in Germany and Texas as it tries to ramp up production, in a video interview with Tesla Owners of Silicon Valley posted online Wednesday.

Earlier this month, Musk announced its decision to cut costs by laying off 10% of its salaried workers over the next three months, which represents about 3.5% of its global workforce.

In May 31 interview, Musk said that the company has struggled to quickly increase production in the Austin plant of Model Y SUVs that use the new 4680 cells and structurally integrated battery pack. Thus, the company decided it would also make Model Y SUVs with the older 2170 cells in Austin to keep up with the high demand for its cars, as noted in its April letter to shareholders. The struggles in getting the Austin and Berlin factories up and running were also a result of the company dealing with Covid-related lockdowns at its Shanghai plant.

According to Musk, the problems in the Austin factory are all going to get fixed real fast, but it requires a lot of attention and effort. Berlin factory is in a “slightly better position” as the company outfitted it to build cars with its 2170 cells.

By Davit Kirakosyan

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