Tesla’s new factories are “gigantic money ovens,” says Elon Musk

Tesla Inc.’s two newest car plants have lost billions of dollars as supply chain disruptions and battery cell manufacturing challenges limit the company’s ability to ramp up production, Elon Musk said in a recent interview.

The company’s plants in Germany and Texas, which opened earlier this year, are “gigantic money ovens,” the Tesla boss said an interview from 30 with a Tesla Owners’ Club released on Wednesday.

“Our biggest 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 expects Tesla to resolve these issues quickly.

In the weeks since the interview was recorded Tesla has started layoffs that according to Musk, 10% of the company’s employees could be affected.

Musk did not immediately respond to a request for comment. Tesla’s stock TSLA,
closed down less than 1% on Wednesday but is down around a third in 2022.

Car manufacturing is notoriously a cash-grabbing business, and for years investors feared Tesla’s war chest would not suffice. However, those concerns had subsided as the company paid off debt, raised cash, and reported a string of quarterly earnings that helped make it the world’s most valuable automaker. In the first quarter, Tesla was sitting on about $17.5 billion in cash.

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Brian Lowry

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