Tesla Halts Production at German Factory Amid Supply Chain Disruptions from Red Sea Attacks
Tesla has announced a temporary suspension of most production at its German factory, attributing the pause to disruptions in the Red Sea, a crucial global shipping route.
The electric vehicle manufacturer stated that its Berlin factory, responsible for producing Model Y vehicles and batteries, will be on hold from January 29 to February 11.
It’s a fresh sign of how the hostilities in the Mideast are disrupting global manufacturing supply chains, with shipping companies reporting that they’re being forced to reroute vessels carrying goods and components on the longer route around the southern tip of Africa. Analysts say the detour adds 10 days or more to the journey.
According to Tesla, “The armed conflicts in the Red Sea and the associated shifts in transport routes between Europe and Asia via the Cape of Good Hope are also affecting production in Grünheide. The significantly longer transport times create a gap in the supply chains.”
The U.S. led airstrikes on Thursday against Yemen’s Houthi rebels in response to their attacks on Red Sea shipping.
Tesla noted that normal operations are expected to resume on Feb. 12. The factory in Grünheide, southeast of Berlin, is Tesla’s first in Europe. It opened in 2022 and employs 11,000 workers.
