Musk’s factories are losing billions of dollars: He is focused on avoiding bankruptcy



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Musk’s factories are losing billions of dollars: He is focused on avoiding bankruptcy

Tesla's new factories in Germany and Texas are losing "billions of dollars", said the executive director of the American electric car manufacturer Elon Musk, emphasizing the high costs, modest production and problems in the supply chain.

Tesla's gig factory in Gruenheide near Berlin is its first plant in Europe, and the plant in Austin opened in April this year.

These plants are "swallowing a lot of money at the moment"

These plants are "swallowing a lot of money at the moment", Musk said in an interview for the club of Tesla car fans in Silicon Valley, pointing out the high costs, modest production and problems in the supply chains of the automotive industry.

At the moment, I am focused on maintaining the business so that the workers are paid their salaries and so that the company does not go bankrupt, Musk said. High costs of starting production in new factories are a common occurrence, but Tesla also has problems in the plant in Shanghai, due to the lockdown, which according to Musk caused enormous difficulties in production.

The head of Tesla recently announced the abolition of labor, warning on several occasions that he expects a decline in activity in the world economy. Tesla will cut three to 3.5 percent of jobs in the coming months, Musk confirmed on Monday, adding that it will cut a dozen jobs in design and development departments.

The company employed just under 100,000 workers at the start of the year. Things are not looking good for Elon Musk, but he has great confidence that the supply chain issues currently capsizing his business will clear up soon.

Everyone is wondering if sinking Tesla's stock value is his nuclear option to get out of the Twitter deal. Musk has complained about supply-chain snags in the past. Last year, the billionaire said Tesla faced "super crazy supply-chain shortages."

Earlier this week, the CEO told Bloomberg that supply-chain issues had become Tesla's biggest hurdle. "Our constraints are much more in raw materials and being able to scale up production," Musk said in an interview with Bloomberg at the Qatar Economic Forum.

"As anyone knows who has tried to order a Tesla, the demand for our cars is extremely high and the wait list is long. This is not intentional, and we're increasing production capacity as fast as humanly possible."