Reuters reported on Friday that an internal notice showed that Tesla has canceled plans to resume production at its Shanghai factory this weekend.
The Shanghai factory, located in the Pudong district east of the city’s Huangpu River, suspended production from Monday until Thursday after the city launched a two-stage lockdown on March 28th to combat a surge in COVID-19 cases. In the lockdown area, all enterprises need to carry out closed production or remote work. The lockdown within the districts east of the river are scheduled to be lifted in the early hours of April 1. The U.S. automaker initially planned to resume production that same day.
From early Friday morning, Shanghai will block the area west of Huangpu River. Two people familiar with the matter said that Tesla had yet to secure permits from the Shanghai government for its trucks to deliver assembled electric cars outside of Pudong to the western parts of the city. The company may have also opted to extend the suspension because of a shortage of workers, with lockdowns continuing within some housing compounds, one of the sources said.
The Shanghai Gigafactory is Tesla’s first automobile manufacturing plant abroad and half of all Tesla’s electric vehicles were produced in the factory last year.
On the flip side, after a lengthy delay, Tesla’s German factory has finally put into production earlier this month and delivered its first batch of Model Y models. According to Tesla’s plan, the German factory will produce about 500,000 cars every year, while the nearby battery factory will produce more than 50 gigawatt hours of batteries every year.
In addition, the Anting factory in Shanghai for SAIC Volkswagen, a Chinese automaker, will suspend production from April 1 to 5 due to its location near the west of the river. The company had been striving for a closed pathway to keep the factory from stopping production. Unlike Tesla, the company got a pass to continue shipping by letting workers live in the factories during the blockade and had obtained regulatory permission. Workers will sleep, live and work in isolation in the factory to prevent the spread of the virus.