Elon Musk's confidence in China is reciprocal

COVID-19 forced many automakers and suppliers to shut down in China last month, and many of them are just beginning to ramp up production after the long break. That said, another production pause has taken place again. Nevertheless, amidst the surge in cases, Tesla was actually one of a handful of companies the city of Shanghai worked hard to help reopen — showing just how important to the city and to mainland China’s economy the automaker is.

Officials in Shanghai helped Tesla cart over 6,000 employees and supplier employees to their jobs to help the automaker re-open the factory following COVID-19 lockdowns, according to a CNBC report detailing a letter Tesla sent to authorities. In the letter, Tesla broke down how the city helped the automaker establish its closed-loop production system, including extra disinfection work to help curb the virus’ spread.

Tesla reopened its Gigafactory Shanghai on April 19, following a 22-day production halt due to the surging virus and China’s COVID-zero lockdown policies.

The letter Tesla sent to Lingang officials, dated May 1, thanked them for arranging buses to transport the over 6,000 Tesla employees and those of suppliers to factories, and for hard work disinfecting to prevent any further spread of the virus.

“They fought for three consecutive days, working round the clock and non-stop to guarantee our company’s workers could return to the factory,” Tesla wrote in the letter.

Tesla was among the companies whitelisted to resume over 80 percent production by the city of Shanghai earlier this month, according to a report from Global Times earlier this month. Other important automakers and semiconductor manufacturers whitelisted to reopen included SAIC Motor and Hua Hong Semiconductor, though Tesla’s scope and status in a burgeoning electric vehicle industry speak for themselves.

Last year, Tesla’s Gigafactory Shanghai delivered a total of 484,100 vehicles including those in China and exported units, and the automaker is thought to have missed out on producing more than 50,000 vehicles during the production halt.

Tesla also plans to expand its Shanghai factory to include an additional production facility on a nearby plot of land, expected to add as many as 450,000 vehicles in annual production capacity.

Despite the loss in production units, Shanghai’s move to get Tesla back up and running shows the automaker as a serious global contender in what is the world’s largest auto market. In addition, Tesla is uniquely positioned to capitalize on the coming EV boom, as more consumers than ever start to transition to zero-emission options. 

None of this would even be possible without the impressive work ethic showcased by China's workers according to recent praise from Tesla's CEO Elon Musk.

"There's just a lot of super-talented, hardworking people in China who strongly believe in manufacturing," Elon Musk explained in an interview with the Financial Times last week. "They won't just be burning the midnight oil. They will be burning the 3 a.m. oil," he continued. "They won't even leave the factory type of thing, whereas in America people are trying to avoid going to work at all."


Source: CNBC / Global Times / Financial Times