Musk Confirms Tesla's Plant Closure But Denies It Will Last 2 Weeks

Tesla CEO Elon Musk confirms the Fremont plant shut down due to part shortages. Says the production plant is now back up and running.

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February 26, 2021 3 min read

This story originally appeared on ValueWalk

Tesla CEO Elon Musk has confirmed the plant closure that was reported on Thursday. However, he denied the claim that it was set to be closed for two weeks, saying that it was shut down for only two days this week but is back up and running.

Tesla plant closure confirmed

Musk confirmed the Tesla plant closure in response to a Twitter user asking for news on the Fremont, Calif. shutdown. He said the factory closed for two days due to parts shortages but restarted on Wednesday.

Musk didn’t provide any details on what parts were in short supply or whether the entire factor was shut down and reopened. A source reportedly told Bloomberg that Model 3 production would be halted for two weeks starting on Feb. 22. The Fremont plant assembles the Model 3, Model S, Model X and Model Y.

Conflicting reports about the Tesla plant closure

A chip shortage was widely speculated as the reason for Tesla’s plant closure as several automakers have had to reduce production due to it. Although Musk didn’t mention the claim that Model 3 production would be halted for two weeks, a source reportedly told Reuters that some workers had been told they could take off Wednesday and Thursday.

Another source said some employee lots seemed to have fewer cars than usual on Thursday despite Musk’s report that the factory was back up and running.

“High demand” for new Model S and Model X

Electrek obtained an email in which Musk said Tesla used the plant closure “to do equipment upgrades and maintenance.” He confirmed the parts supply problems and said production is back up and running “and will speed up rapidly to full Model 3/Y production over the next few days.

Musk also said they are seeing “high demand” for the refreshed Model X and Model S and that the retooling for the refreshes is almost done. He added that production on the two vehicles would ramp up in the next quarter. The automaker will be adding a second shift to keep up with the strong demand for the new Model X and Model S. Musk advised employees to recommend friends for recruiting.

Tesla is part of the Entrepreneur Index, which tracks 60 of the largest publicly traded companies operated by their founders or their founders’ families. Musk co-founded the company with J.B. Straubel, Martin Eberhard, Marc Tarpenning and Ian Wright. Straubel was Tesla’s chief technical officer until he switched to an advisory role in 2019.

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