AutoBeta(AutoBeta.net)12/10 Report--

According to several media reports, an internal memo shows that Tesla Shanghai Super Factory will suspend production of Model Y models from December 25, 2022 to January 1, 2023. According to the internal memo, Tesla aims to produce just over 20, 000 Model Ys in the last three weeks of December, including the week when production is about to be suspended. For comparison, weekly production of the Model Y remained at around 13000 in November, equivalent to 39000 in three weeks.

According to people familiar with the matter, the Shanghai factory was operating normally in the same period last year, so it is not an established practice for the plant to be closed during the year-end holiday. The suspension of production of Model Y models is also part of Tesla's previous plan to cut production by 30 per cent, the person familiar with the matter said. At the same time, a piece of news that Tesla will shorten the working hours of employees on the Shanghai factory production line as early as next Monday and has postponed the appointment of some new employees has also circulated on the Internet.

As of press time, the official did not respond to the above news.

On December 7th, it was rumored online that Tesla planned to reduce the production capacity of the Shanghai super factory by 20 per cent, saying that this was the first time that Tesla had voluntarily reduced production at the Shanghai factory. According to people familiar with the matter at that time, the move was related to the fact that the demand in the Chinese market did not meet Tesla's expectations, and it was also a decision made by Tesla after assessing his recent performance in the domestic market. Tesla has enough flexibility to increase production if demand increases. The news was later officially denied by Tesla, Tesla said: "the report that the company's Shanghai factory will reduce production is not true, Tesla Shanghai super factory production rhythm is normal."

Shanghai Super Factory is Tesla's first overseas factory, located in Shanghai Lingang New District, covering an area of 860000 square meters, including vehicle production area, test area, parts production area and joint workshop (maintenance workshop). It mainly produces Model 3 and SUV Model Y cars. Data show that in 2021, Tesla Shanghai Factory delivered a total of 484000 new cars, accounting for 51.7% of Tesla's total global delivery. it is Tesla's first single market in the world, including 169853 domestic retail vehicles for Model Y and 150890 for Model 3.

After entering 2022, the factory was affected by the outbreak in the first half of the year and was forced to suspend production several times. In July, Tesla began to upgrade the production line of the Shanghai factory. After completing the renovation plan in early August, the plant's production capacity has climbed to 1.1 million vehicles, an increase of about 127% over the same period last year, making Tesla the super factory with the highest capacity. Data show that by the end of November, the Tesla Shanghai factory had delivered a total of 655000 new cars in 2022. Among the specific models, retail data showed that 285900 Model Y vehicles were delivered in the first 11 months, an increase of 121.0% over the same period last year. 111900 models were delivered, down 7.3% from the same period last year.

As for Tesla, it has been reported one after another that the Shanghai super factory has reduced production and stopped production, which may be related to the substantial increase in Tesla's production capacity at this stage and the fact that the market demand has not met expectations. Since September, Tesla has launched many price reductions and promotions in the Chinese market, including reducing the prices of Model 3 and Model Y models on sale in Chinese mainland region by 14000 yuan to 37000 yuan. At the same time, the car pick-up cycle has been shortened again and again, and this month, Tesla has successively introduced a number of time-limited preferential measures.

Tesla's official website

It is undeniable that Tesla got a good response in November under the stimulation of a series of measures. According to the latest data from the Federation of passengers, Tesla's wholesale sales in November were 100291, an increase of 89% over the same period last year and 40% month-on-month, setting a new monthly delivery record. However, compared with its previous annual sales target of 1.5 million vehicles, Tesla still faces severe sales pressure.

Tesla delivered a total of 908000 new cars worldwide in the first three quarters of 2022, according to official data, meaning Tesla needs to complete a shortfall of more than 500000 vehicles in the fourth quarter to achieve his annual sales target. What is different from many car companies is that Tesla's failure to achieve his goal is not due to insufficient production capacity, but the overstocking of new cars and the fact that new car sales fall short of expectations. In October 2022, Tesla Shanghai Super Factory produced a total of 87706 Model3 and Model Y, with delivery of 71704 vehicles and inventory of 16002 vehicles. The phenomenon of "high inventory" and the obvious gap between production and marketing may be the reason why Tesla launched frequent promotions.

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