Toni Dimaano Auto 12.28.2022 00:Dec AM EST

Tesla To Slow Down Production At Shanghai Plant In January

In order to continue the lower output it started this month into next year, Tesla plans to run a reduced production schedule at its Shanghai facility in January.

Tesla will operate manufacturing for 17 days from January 3 to January 19, before ceasing production of electric vehicles for a lengthy break for the Chinese New Year from January 20 to January 31.

Tesla Feels The Impact Of China's COVID-19 Resurgence

It comes after Tesla halted production at the facility beginning on December 24 and lasting until January 1, according to Reuters's reports.

A production freeze can be regarded negatively as the Shanghai facility contributed to the production of half of the company's Tesla automobiles in the first half of 2022.

Analysts believe that the company's predicted 50% output rise year over year will actually only be a meager 45%.

Additionally, it is unknown if the factory's 20,000 or so employees will be paid for the time they spend off the production line.

The Shanghai firm has come under fire for its labor practices, which include 12-hour shifts five days per week.

Earlier this year, due to frequent lockdowns, the factory reportedly required employees to live and sleep there, according to Gizmodo.

It can be remembered that Tesla CEO Elon Musk has in the past called the company's other plants in Texas and Germany "money furnaces."

This is because the reductions in Shanghai for 2023, all while blaming supply chain problems, do not suggest the electric vehicle firm expects anything to improve in the next year.

Tesla Has Been Struggling In Previous Months

The company has struggled over the previous few months. According to separate reports quoting unnamed insiders, Tesla has implemented a recruiting freeze and has begun to lay off employees.

The news came after hiring halted in June amid a pessimistic outlook for the entire global economy, Gizmodo writes.

Because of this, in July of last year, Tesla also experienced a fall in profitability for the first time in over a year.

It is important to note that since China's absurd "zero covid" policy was implemented, the nation has seen an increase in new covid infections.

It was an attempt to control the large anti-government rallies that were sweeping the nation, but the results have been reports of a staggering number of injuries and fatalities.

Aside from this, the fact that Musk continues to serve as the head of Twitter has caused him to become preoccupied with his duties as the CEO of Tesla.

Some analysts are openly doubtful that the billionaire can be dedicated to his former automaker after the latter's $44 billion purchase of the platform.

This is because he sold $3.6 billion worth of Tesla shares earlier this month, and some experts have predicted the funds may be used to fill in gaps in the Twitter acquisition.

Since the beginning of the year, Musk has sold shares in Tesla worth $23 billion, according to documents submitted to the Securities and Exchange Commission.