Yicai reported on Sunday that Tesla’s Gigafactory in the Lingang New Area of Shanghai has changed from a single-shift to a dual-shift work system, still adopting closed-loop production amid a local outbreak of COVID-19. The facility’s output capacity is reportedly at basically the same level as before the lockdowns, and it is expected to restore normal production in June.
A related individual told Yicai that logistics networks had basically been restored, and that they could now ensure production and supply. However, logistics involves many complicated factors such as interprovincial pandemic prevention and control, so they haven’t fully recovered to the pre-outbreak levels.
Before the Shanghai lockdowns, Tesla adopted a three-shift production system, with a weekly output of nearly 20,000 vehicles and a daily output of over 2,000 vehicles. Tesla expected its production capacity to return to pre-outbreak levels in mid-May, but delayed the plan several times due to supply chain issues. As of May 17, its overall capacity utilization rate was only 45%.
After more than two years of operation, Tesla’s Shanghai Gigafactory has achieved a localization rate of about 95% in the supply chain. This helps enterprises to better cope with the impact of transnational supply chain caused by pandemic-induced closures and control measures. A multinational factory within Tesla’s supply chain in Shanghai said logistics have basically recovered to pre-outbreak levels. This factory was also facing a shortage of raw materials and packaging materials at the initial stages of resuming production, but its production capacity was greatly improved.
In addition, as Tesla’s “global export center,” Gigafactory Shanghai is still actively meeting export demand. Export logistics are obtaining full support from China’s Customs Department. As of mid-May, two batches of Tesla electric vehicles were shipped to Europe and other places, with a total export of about 9,000 vehicles.