Tesla Will Suspend Model Y Production In Shanghai For One Week In December

A few days ago, CleanTechnica reported rumblings that claimed Tesla would cut production at its Gigafactory in Shanghai this month. A chorus of boo birds were quick to accuse us, and specifically me, of being a fake journalist who spits out clickbait stories that have no basis in fact. Regular reader Ian-ya couldn’t wait to get his poison pen out to excoriate me.

“Yeah, CleanTechnica is writing a retraction now, expect it to be posted on pg 43,” he posted. “Surely Steve has earned enough to pay his funeral expenses? His bile is tiresome. Does Mary do no wrong? Bozo? M. Bloomberg? Saint Joe Biden? Used to be Stevie would rile against Koch, Heartland institute.”

Some people just can’t stand it when their favorite beliefs are exploded. Do he and his fellow detractors have to say now that it has been revealed our reporting was accurate? Here’s the latest from Reuters, which says Tesla will suspend Model Y assembly at its Shanghai plant between Dec. 25 and Jan. 1, according to an internal memo detailing the automaker’s latest production plan that it has reviewed.

That memo has also been confirmed to Reuters by two people with knowledge of the matter, who said the suspension of production at the end of the month is part of a planned cut in production of about 30% in the month of December for the Model Y. Tesla maintained normal operations at the Shanghai factory in the last week of 2021. It has not been an established practice for the plant to shut down for a year-end holiday, the two people added.

Giga Shanghai employees celebrate the production of the 1 millionth vehicle produced at the factory (a red Tesla Model Y). Credit: Tesla China via Jay in Shanghai.

Reuters says it is not clear whether output of the Model 3 will be affected by the planned suspension of output of the Model Y, which represents the largest share of production at the Shanghai plant. It reported on Monday that Tesla planned to cut December output of the Model Y at its Shanghai plant by more than 20% from November. That news was included in our previous story.

A Tesla representative said at the time the news, which was first reported by Bloomberg, was “false,” without elaborating. Reuters could not determine the reason for the planned reduction in output at the Shanghai factory or the planned closure at year end, but says Tesla China has experienced elevated inventory levels after an upgrade to the Shanghai facility was completed in the summer.

While Beijing has made significant changes to its zero COVID policy in the past few days, the China Passenger Car Association said on Thursday that demand for new cars was weakening faster than expected. China’s passenger vehicle sales fell for the first time in six months in November. It added that it expects sales to stay flat next year in China, the world’s largest vehicle market.

Reading The Tea Leaves

Based on the Reuters report, Tesla is voluntarily producing fewer cars in China that it could. Why? Nobody knows. Your guess is as good as ours, but it’s hard to see how this is good news for Tesla’s China division.