Tesla prepares to reopen Shanghai factory as city aims to ease Covid curbs

Electric vehicle giant Tesla along with other automakers in China has started preparing to reopen its Shanghai factory as the city accelerated efforts to exit a Covid-19 lockdown that has forced most businesses to shut for nearly three weeks. While preparing to resume production, Tesla has recalled workers to its factory, Reuters reported citing sources.

The report stated that while the US automaker had initially intended to resume one production shift on Monday, it was now looking to do so on Tuesday because a supplier was facing issues with logistics. The EV maker had suspended production at its Shanghai plant since March 28, leading to an output loss of more than 40,000 units. Tesla's Shanghai manufacturing hub makes 10,000 Model Ys and 6,000 Model 3s per week.

Meanwhile, SAIC Motor, the Chinese partner of Volkswagen and General Motors, said it will start stress-testing its production resumption plans from today. The move comes as Shanghai aims to stop the spread of Covid-19 outside of quarantined areas by Wednesday, further allowing the easing of its lockdown. It is stepping up testing and the transfer of positive cases and their close contacts to isolation centres to meet that target.

As Chinese carmakers with production facilities in the country's northeastern provinces are resuming production and those places are emerging from lockdowns, state-owned Chinese automaker FAW Group has already resumed some production at its Hongqi plant in Jilin. BMW said all of its plants in the city of Shenyang has restarted operations too.

Shanghai is under pressure to deliver on China's Covid-19 elimination strategy, which largely kept the coronavirus at bay for the last two years but is increasingly challenged by the highly infectious Omicron variant.

(with inputs from Reuters)