Tesla’s new factories are ‘gigantic money furnaces,’ Elon Musk says

Tesla Inc.’s two newest car factories they have been losing billions of dollars as supply chain disruptions and battery manufacturing challenges limit the company’s ability to increase production, Elon Musk said in a recent interview.

The company’s plants in Germany and Texas, which opened earlier this year, are “giant money kilns,” the Tesla CEO said in a May 30 interview with a Tesla homeowners club that was published on Wednesday.

“Our overwhelming concern is, how do we keep the factories running so we can pay people and not go bankrupt?” Musk said in the interview. He added that he hoped Tesla would resolve these issues quickly.

In the weeks since the interview was recorded, Tesla has begun layoffs that Musk indicated could touch 10% of the company’s salaried workforce.

Musk did not immediately respond to a request for comment. TSLA of Tesla shares,
closed less than 1% on Wednesday, but has fallen by about a third in 2022.

Car manufacturing is a notoriously cash-hungry business, and investors for years worried that Tesla’s war chest wasn’t enough. These worries had eased, however, as the company paid off its debt, raised money and reported a number of quarterly profits that helped turn it into the world’s most valuable carmaker. . As of the first quarter, Tesla had approximately $ 17.5 billion in cash.

An extended version of this report appears on WSJ.com.

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