Tesla’s China Gigafactory Reopens After Coronavirus Lockdown

Tesla’s Shanghai Gigafactory resumed operations on Monday after weeks of a government-mandated temporary shutdown due to the coronavirus outbreak in China, Japanese outlet The Asahi Shimbun reported today.

Tesla restarted work on its China-built Model 3 in the Pudong Xinqu area of Shanghai on the morning of February 10, the publication said, citing a driver of shuttle buses for employees.

Some 40 shuttle buses, compared to the typical 100 buses, took local employees to the Shanghai factory, the driver said.

“Employees who have returned from outside the city cannot come to work because they are required to be quarantined for 14 days,” the driver told The Asahi Shimbun, adding that those who reported for work on Monday are only part of the employees who have been given the all-clear and do not need to be quarantined.  

In early January, Tesla delivered its first cars to customers from its newly built Gigafactory in Shanghai, just a year after it broke ground on the site for the construction of its Gigafactory in China. 

The coronavirus outbreak later in January halted a lot of industrial activities in China and forced the authorities to extend the Lunar New Year holidays, while a number of foreign firms closed shops, offices, restaurants, and production lines.

Related: Are Oil Markets Overreacting To The Coronavirus?

In its Q4 earnings call at the end of January, Tesla’s chief financial officer Zachary Kirkhorn said, in reference to the virus impact on the company’s operations in China:

“At this point, we're expecting a 1 to 1.5 week delay in the ramp of Shanghai built Model 3 due to a government required factory shutdown. This may slightly impact profitability for the quarter, but is limited as the profit contribution from Model 3 Shanghai remains in the early stages.”

This weekend, a government official from Shanghai said - as carried by Reuters - that the local authorities would help manufacturing firms, including Tesla, to restart production in and around the city as quickly as possible.  

By Tsvetana Paraskova for Oilprice.com

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