On Saturday, Tesla company suspended production at one of its plants in Shanghai. According to available information, the plant will suspend most of the work during December's last week.
Tesla has canceled the morning shift at its Shanghai plant and has told all of its workers to start their break. As for the exact reason behind this suspension, the company didn't give any yet.
And just a few weeks ago, there were reports that Tesla also plans to suspend the production of Model Y between 25th December - 1st January.
This news is coming at a time when the COVID infection is on the rise after China had to ease some of its policies related to zero COVID. For the most part, this was welcomed by the businesses operating in China as well as the general public.
According to one person working at the Tesla plant, the suppliers, as well as the workers of the company, have also gotten infected by the COVID-19 virus. So that could also be a reason why the company was forced to suspend its operations for a few days.
In addition, another problem facing Tesla is the increased level of inventory. This comes at a time when China is officially getting ready for a downturn.
Another relevant piece of information is that the Shanghai plant was mainly used for the production of cars that can be exported to other countries.
There's also a chance that Tesla might have pulled this move in line with the holiday season as well as the end of the year. But I personally believe that it is a little bit of everything... Tesla had to slow down the production of some car models, and then there were the rising COVID infections in China. This was followed by the holiday season and a downturn in China.
Together, all of these factors made sense for Tesla to suspend operations in one of its plans for a few days. If everything goes as planned, the plant will be back to normal in the first week of January 2023.