Tesla Temporarily Halted U.S. Production Over Parts Shortage

By Rebecca Elliott 

Tesla Inc. Chief Executive Elon Musk said the company paused activity at its lone U.S. car plant in Fremont, Calif., because of parts shortages but has restarted operations.

"Fremont shut down for two days (parts shortages) & restarted yesterday, " Mr. Musk tweeted Thursday.

The auto industry has been grappling with a global shortfall of semiconductors that has caused production-line shutdowns. Companies such as General Motors Co., Ford Motor Co. and Volkswagen AG have idled some of their production capacity as they await critical parts.

The White House on Wednesday said it would try to tackle supply chain problems, including those affecting the car industry.

Mr. Musk didn't elaborate on the nature of the parts shortages. Tesla didn't immediately respond to a request for comment.

The car maker's Chief Financial Officer Zachary Kirkhorn said on an earnings call last month that, "We are working extremely hard to manage through the global semiconductor shortage as well as port capacity, which may have a temporary impact."

The disruption adds pressure on Tesla's first-quarter deliveries. Mr. Kirkhorn said late last month that production of Model S sedans and Model X sport-utility vehicles would be hampered in the first quarter as Tesla works to introduce updated versions. Deliveries should benefit, though, from an increase in Model Y production at the company's China plant, he said.

Tesla has said it expects deliveries this year to advance more than 50% from the roughly 500,000 vehicles it handed over last year.

Tesla last year temporarily idled its Fremont facility for several weeks when local authorities were trying to combat the spread of the coronavirus. The company largely recovered to almost achieve its full-year vehicle delivery target set for 2020.

Write to Rebecca Elliott at [e-mail]

(END) Dow Jones Newswires

February 25, 2021 18:32 ET (23:32 GMT)

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