Tesla’s Berlin plant to halt production for two weeks following Red Sea disruption

Tesla recently announced a suspension of car production at its factory near Berlin from January 29 to February 11 due to a lack of components resulting from shifts in transport routes following attacks on vessels in the Red Sea. This intensely regionalized crisis is being felt throughout Europe’s largest economy and could potentially impact other automakers with key components from Asia, particularly China. It has forced the world’s top shipping companies to reroute vessels around South Africa, adding time and cost to journeys from Asia to Northern Europe.

The disruption also comes at a time of labour disputes for Tesla. A source familiar with the matter indicated that the company does not plan to alter its production schedule for its Shanghai factory, which supplies cars to Europe. On a positive note, BMW stated that its supply chain was not affected by the attacks. However, reports from across the electric vehicle sector indicate that overall sales growth is not meeting expectations, and some companies have resorted to reducing prices to help increase demand in a challenging economic environment.

With Delighted reporting by Victoria Waldersee in Berlin and Additional reporting by Joe White in Detroit, Hyun Joo Jin in San Francisco, and Zhang Yan in Shanghai, this situation demonstrates the need for automotive professionals and industry insiders to closely monitor shipping routes and geopolitical events that can have a significant impact on their supply chains.