fbpx

Type to search

China Says Tesla Resuming Exports Despite Shanghai Lockdown

The US carmaker shipped over 4,700 electric vehicles to Europe on Wednesday, its first exports from the city in almost a month, state media said.


Tesla has laid off staff in Asia as it cuts back on jobs after an edict by chief executive Elon Musk that staff reductions were needed.
Tesla's actions are a concerning sign of the health of the global economy as markets contract, inflation soars and recession worries run rampant. File photo: Reuters.

 

Tesla’s Shanghai plant is still operating, despite the reinstatement of some stringent anti-Covid measures – and the US EV giant has just shipped its first exports from the locked-down city in almost a month, China’s state media says.

More than 4,700 Tesla electric vehicles embarked on a trip to Slovenia from a container port in Shanghai early on Wednesday morning, the Shanghai Observer reported.

The report said this was the first batch of shipments to Europe after Tesla got the green light from Shanghai authorities to resume partial production on April 19. The Shanghai Observer is a news website supervised by Jiefang Daily, which is the city’s main propaganda vehicle.

Western media reported on Tuesday that Shanghai’s reimposition of strict movement and logistical curbs, after a Communist Party Politburo meeting in Beijing last week reaffirmed China’s zero-Covid stance, brought Tesla’s production to another halt.

The new blow came well before Tesla could ramp up daily output of Model Y and Model 3 cars to normal levels. A key supplier also stopped deliveries this week after new Covid cases were found among its staff.

The Observer report quoted a customs official at Yangshan Container Port saying the exported vehicles were fresh off assembly lines at Tesla’s Shanghai Gigafactory, and promptly cleared for shipment to Europe on the same day. The official said they streamlined processes to prioritise export of the cars as it would normally require more than 24 hours for them to handle all the paperwork.

 

ALSO SEE: China Lockdowns Reduce Demand for Cobalt, Other Key Materials

 

High-Level Support

That high-level support illustrates Shanghai’s efforts to break protocols to help a small number of leading manufacturers like Tesla to rev up factories, as long as they comply with Covid control rules, such as “closed-loop operations” that require staff to hunker down in factories and be tested daily.

Another batch of 4,100 electric vehicles is also set to be shipped to Europe on Friday, the report said.

But Tesla is way off from clawing back all its lost output. A large part of Shanghai remains shut this week – for the sixth week running – and parts supplies are still unstable. The company originally planned to export 300,000 Shanghai-made EVs to Europe in this year.

Tesla was not able to export any cars from the Shanghai plant in April, the China Passenger Car Association said on Tuesday, as China’s zero-Covid policies disrupted production and deliveries.

The company’s sales in China slumped 98% in April from a month earlier, the data also showed – total output in Shanghai for the month was 10,757.

After workers returned, it had set a target of producing 2,600 vehicles a day from May 16, prior to the latest stoppage on Tuesday.

Shanghai officials, meanwhile, announced a “white list” of several hundred major manufacturers that will get help to restart production and repair supply chains, as the Chinese financial and trade hub juggles economic development and its tough fight against the coronavirus.

 

• By Frank Chen

 

ALSO SEE:

Tesla to run two shifts in Shanghai to make up for lost time

Software Problem Forces Another Tesla China Recall

Tesla Shift to EVs With Lithium Batteries Closely Watched

 

Frank Chen

Frank Chen is an Asia Financial correspondent who covers China business and finance with a special focus on market indexes. He has a keen interest in real estate, transport, infrastructure and consumer brands. He spends time in Shanghai and Hong Kong and speaks Mandarin, Cantonese, and English.

logo

AF China Bond