Tesla factories lose billions: Musk: Grünheide and Texas “giant money incinerators”

Tesla factories lose billions
Musk: Grünheide and Texas “giant money incinerators”

Tesla boss Musk recently warned of an economic downturn and announced job cuts. In an interview, he now tells how heavily the past two years have weighed on the electric car manufacturer. Especially for Grünheide and Texas he finds clear words.

According to CEO Elon Musk, Tesla’s new electric car factories in Grünheide near Berlin and Austin in the US state of Texas are currently losing “billions of dollars”. Musk described the locations in a video interview as “giant money incinerators.”

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In a conversation with the Tesla Owners of Silicon Valley fan club, he called the past two years an “absolute nightmare” with regard to the supply chain problems in the auto industry. The Tesla boss warned: “We’re not over it yet.” Now it is a matter of keeping the company running so that the employees continue to be paid and the group does not go bankrupt.

While high start-up costs and losses are relatively normal for new plants like Grünheide and Austin in the start-up phase when ramping up production, Tesla also faced challenges with its Shanghai plant. “The Covid shutdowns in China have been very, very difficult to say the least,” Musk said. The interview was conducted on May 31, but the part with the most recent statements has only now been broadcast on the Internet. Musk had recently repeatedly warned of an economic downturn and announced job cuts at Tesla.

The electric car maker will cut 3 to 3.5 percent of its jobs in the coming months, Musk made clear after conflicting reports. Around every tenth job among employees is to be lost, while the number of factory workers will increase in the long term. At the beginning of the year, Tesla had almost 100,000 employees.

The Tesla boss had already informed internally about the plans at the beginning of June. In an email available to the Reuters news agency, he justified this with a “super bad feeling” about economic development. A recession is possible in the near future, he said now. “It’s not certain, but it seems more likely.”

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