Elon Musk says Tesla's Del Valle factory is a 'gigantic money furnace'
Elon Musk said the factory is operating at a huge loss after Shanghai, home to one of Tesla's largest battery producers, instituted a near-total lockdown in the spring.
Tesla CEO Elon Musk says his newly opened electric vehicle factory in Eastern Travis County is "losing billions of dollars" as a result of supply-chain-related issues.
In an interview with Tesla enthusiasts released Wednesday, Musk said the factory in Del Valle is not hitting performance benchmarks, in part, because Chinese battery suppliers have been shutdown amid a COVID-19 outbreak in nearly 30 cities.
"This factory is losing insane money right now," he said. "We should be outputting a lot more cars from this factory, versus a puny amount of cars."
Musk's comments were first reported by The Washington Post.
Tesla's factory in Del Valle, which received millions in incentives from Travis County and Del Valle ISD, opened earlier this year after the electric automaker relocated its headquarters to Austin. Tesla opened another factory in Berlin in October.
Musk said both factories are operating at a huge loss. Shanghai, an industrial hub and home to one of Tesla's largest battery producers, instituted a near-total lockdown as a result of a coronavirus surge this spring.
"Both Berlin and Austin are like gigantic money furnaces right now," he told the group of Silicon Valley-based Tesla owners. "There should be a giant roaring sound, which is the sound of money on fire, OK? Bigger than a dumpster [fire]. ... Berlin and Austin are losing billions of dollars — right now. There's a ton of expense and hardly any output."
Musk said the company's top priority is getting "Shanghai back in the saddle" and getting more cars off the line at both factories.
Earlier this week, Musk said Tesla would likely lay off 10% of the company's salaried employees this year to make up for missed growth projections.
"We grew a little too fast in some areas," he told Bloomberg.