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BEIJING, July 20 (TMTPOST)— Tesla Shanghai Gigafactory managed to achieve record production even in the quarter when Covid-19 disruptions remained a major challenge.
Source: Visual China
During the second quarter of the year, the Shanghai factory was shut down fully and then partially for the majority of time, but it made a record monthly production in the last month of the quarter, Tesla said at its quarterly report released on Wednesday. The electric vehicle (EV) giant achieved record production rates across the company, though warning ongoing manufacturing challenges that limit consistently run its factories at full capacity, such as those related to shutdowns and global supply chain disruptions.
Tesla showed confidence on Shanghai factory’s future performance as it expected recent equipment upgrades would enable it to further continue increase of production rate. Report showed that Shanghai Gigafactory currently tops all the other Tesla’s factories in the world in terms of capacity. Following upgrades, the installed annual capacity of Shanghai factory increased to more than 750,000 vehicles as of end of the second quarter. The Fremont factory in California has an annual capacity of 650,000 units, while the factory in Austin, Texas and the new one in Berlin-Brandenburg each have a capacity of more than 250,000 units.
Tesla booked better-than-expected financial results in the second quarter, but both the top and bottom line saw significant slowdown. Its revenue and earnings increased 42% and 57% year-over-year (YoY) respectively, compared with YoY increases of 81% and 246% in the previous quarter. It delivered about 254,695 vehicles that quarter, suggesting the first quarter-over-quarter decline in two years.
Tesla cautioned manufacturing challenges facing the Austin and Berlin factories’ production ramp-up, but seemed optimistic on outlook in the second half of the year. “With each of the Fremont and Shanghai factories achieving their highest-ever production months and new factory growth, we are focused on a record-breaking second half of 2022,” the report said. In a call with analysts, Tesla CEO Elon Musk said his company was expected to break production record in the next half of the year.
The Covid resurgence in Shanghai forced Tesla China to halt production in the Shanghai factory from March 28, and just get about 8,000 workers back about three week later, operating in a closed-loop system, restricting the contact with the outside world. In an earnings call for the first quarter in May, Musk said Tesla Shanghai factory could see record weekly output in the second quarter following reopen. In spite of the three-week shutdown that had made Tesla lost weeks’ of capacity, Musk that month estimated Shanghai factory would see “substantially higher” outputs in the third and fourth quarter.
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