Tesla’s recent price drops in various international markets, including China and the US, seem to be driving massive demand. To meet this demand, the electric vehicle (EV) maker is reportedly ramping up production at its Giga Shanghai factory in China, with plans to produce around 20,000 units per week.
The Giga Shanghai factory has been a standout in terms of output and efficiency, and recent upgrades at the end of 2022 only enhanced these capabilities. However, Tesla chose not to maximize production in 2022, causing some concern about potential demand problems. The automaker’s new plan to increase production in response to the surge in demand dispels those worries.
Last year, Tesla offered incentives to increase sales and while it contributed to some extent, it was only after the recent price cuts that demand for their electric vehicles saw a significant surge.
One of the most vital factories for Tesla is the Giga Shanghai, which not only supplies EVs to the largest auto market in China but also serves as the primary export hub for the company. Drone footage has captured the shipment of Tesla EVs to various destinations, including Europe, where many of the vehicles produced in Giga Shanghai have found their new owners.
While Tesla has a factory in Germany, it is still in the process of ramping up production and currently only producing the Model Y crossover. Despite the speculations about a potential drop in demand, Tesla has continued to upgrade existing factories and open new ones to increase output. CEO Elon Musk acknowledged the long delivery wait times and expressed his desire to lower prices, which he believed had become too high.
Tesla’s production output at its Giga Shanghai factory in China showed a decline after reaching a high of 80,000 electric vehicles (EVs) in September 2022. But according to a recent Reuters report based on an internal “planning memo,” Tesla plans to increase its weekly average production rate to around 20,000 units for the months of February and March. The authenticity of the memo has not been confirmed.
It is not known if Tesla will continue to export EVs from Giga Shanghai in the first quarter of 2023 or if the increased production will be solely for domestic deliveries. Historically, the company focuses on exports at the start of a quarter before shifting to local orders. However, reports of price cuts in China suggest that there is a high demand for Tesla’s EVs within the country.
