Red Sea assaults halt Tesla manufacturing at German plant

Electric automotive maker Tesla will droop most automotive manufacturing at its manufacturing facility close to the German capital of Berlin for 2 weeks, the corporate stated on Thursday.

“Due to a lack of components, we are forced to suspend vehicle production at the Gigafactory Berlin-Brandenburg between January 29 and February 11, with the exception of a few sub-areas,” Tesla stated in an announcement.

The firm blamed the element scarcity on shifts in transport routes brought on by the disaster within the Red Sea, the place Iranian-backed Houthi militants have been attacking ships in solidarity with the Palestinian militant-Islamist group Hamas, which is preventing Israel in Gaza.

“The armed conflicts in the Red Sea and the associated shifts in transport routes between Europe and Asia via the Cape of Good Hope are also having an impact on production in Grünheide,” Tesla stated.

Why are transport companies suspending routes within the Red Sea?

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Red Sea disaster

The US electrical car maker is the primary firm to announce an interruption to output as a result of disruption. Many corporations, together with Geely, China’s second-largest automaker by gross sales, and Swedish dwelling furnishing firm Ikea, have warned of delays to deliveries.

The assaults by Iranian-backed Houthi militants have pressured the world’s high transport corporations to keep away from the Suez Canal, the quickest maritime route from Asia to Europe. It accounts for about 12% of world maritime site visitors.

Shipping giants akin to Maersk and Hapag-Lloyd have been sending their vessels on longer, dearer journeys round South Africa’s Cape of Good Hope. The additional route provides about 10 days in a journey from Asia to northern Europe and about $1 million (€910 000) in additional gasoline.

“The considerably longer transportation times are creating a gap in supply chains,” Tesla stated. The firm has been manufacturing electrical automobiles in Grünheide close to Berlin since March 2022, with round 11,500 folks employed there.

dh/sms (dpa, Reuters)