Tesla to shut Model S, Model X production for 18 days. Here's why

Employees who work on the production lines of Tesla Model S and X will receive one week of pay and a few more paid leaves.They will not be paid for th
File photo of Tesla Model X (REUTERS)
File photo of Tesla Model X

Tesla has informed its employees in Fremont, California via an email that its production lines for Model S and Model X electric vehicles will be shut for 18 days over holidays. The production lines will be closed from December 24th to January 11th, as reported by CNBC.

Employees who work on these lines will receive one week of pay and a few more paid leaves. They will not be paid for the rest of the days of the shutdown. However, they have been encouraged to try to find jobs in other areas of the factory or volunteer to help make deliveries to customers. The email, as quoted by CNBC, read, "There will also be limited paid opportunities for you to support other shops or volunteer for deliveries during some of this time."

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Also Read : US safety agency opens probe into 115,000 Tesla vehicles over suspension issue

Though it has not been specified what Tesla intends to do during the shutdown of the vehicle lines, it possibly points towards design refresh, as per Electrek. The Model S has been slightly updated over the years it has mostly remained unchanged but design-wise since 2016.

Tesla Model S (REUTERS)
Tesla Model S (REUTERS)

However, it is also possible that Tesla is shutting shops for these vehicles due to the lack of demand. The company's vehicle production and deliveries report from the period ending September 30 noted that deliveries of Model S and X amounted to only 11% of vehicle deliveries during the quarter.

Another possibility is that the company could be retooling these production lines due to the ongoing suspension issue with regard to Model X. The issue has caused a recall in China and an investigation in the US.

On the same day, in a separate email sent to the employees, CEO Elon Musk asked them to boost production for the remaining of the quarter. He said that the demand for Tesla vehicles is so high that production needs to increase as much as possible for the rest of December. The company has a target of delivering 500,000 cars this year.

First Published Date: 16 Dec 2020, 08:49 AM IST

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