Tesla to raise output in this plant after price cuts stoke demand

Tesla plans to ramp up production output at its Shanghai manufacturing facility over the next two months in a bid to meet demand, which witnessed a significant surge owing to aggressive price cuts over the last few months. Reuters reports that the automaker has already started preparation for that. The report further claims that Tesla plans to produce a weekly average of nearly 20,000 cars at its Giga Shanghai factory in February and March.

The report has further claimed that this level of vehicle production would take the Giga Shanghai plant's output to roughly its rate in September 2022, when it rolled out 82,088 units of Model 3 and Model Y cars, as stated by cited China Passenger Car Association (CPCA). However, Tesla has not officially stated anything about this plan.

In the recent past few months, Tesla has consecutively announced price cuts for its electric cars across the world. China being a major market for the brand, the automaker announced multiple price cuts in the country. This has helped the auto company to register higher demand for its vehicles. Now, in a bid to sustain this momentum, Tesla aims to increase its production volume. However, apart from the recent demand hike, Tesla has been aiming to increase the production of its vehicles in all its factories worldwide in a bid to reduce the notorious waiting period the auto company is known for.

In December 2022, Tesla's Giga Shanghai plant cut the production output by around one-third compared to the previous month. Also, it extended the Lunar New Year holiday period for workers of the plant in January 2023 to cope with the rising inventory level. Tesla CEO Elon Musk last week said that orders it received in January this year were roughly double its production volume after the price cut announcements.

Tesla currently manufactures Model 3 and Model Y cars in the Giga Shanghai facility, which are the two bestselling EVs from the brand. With the planned production ramp-up, not only Chinese buyers but consumers from other markets too would see a reduced waiting period in the coming days.