Musk Says New Tesla Factories Are “Gigantic Money Furnaces Right Now”

The recently opened manufacturing facilities in Germany and Texas are “losing billions of dollars” for Tesla (Nasdaq: TSLA), according to CEO Elon Musk himself. Battery shortages and COVID-related Shanghai shutdowns were the main reasons cited by the executive.

“Both Berlin and Austin factories are gigantic money furnaces right now. Okay? It’s really like a giant roaring sound, which is the sound of money on fire,” Musk said in an interview with a group named Tesla Owners of Silicon Valley.

The group released the last segment of its three-part interview with the Tesla chief on Wednesday.

Image

Going into specifics, Musk highlighted the challenges faced at Tesla’s two newest gigafactories, particularly in producing its “4680” batteries. There are also hurdles in making its conventional “2170” batteries as raw materials are “stuck in port in China,” related to the pandemic-related shutdowns.

“This is all going to get fixed real fast, but it requires a lot of attention,” Musk added.

The 4680 lithium-ion batteries have about five times the energy of the smaller 2170 cells. Musk announced in March the plan to ramp up the production of 4680 batteries to reduce manufacturing costs.

But for the group that interviewed the controversial billionaire, it seems unfair that the increasing factory overhead costs got all the attention. It even went as far as saying that it’s “insane that Tesla is profitable given this investment.”

This grim profitability outlook follows Musk’s announcement earlier this month to cut down the workforce by 10%, given his “super bad feeling” about the economy. The Tesla chief also has been stricter about the company policy of 40-hour work week at the office; otherwise, the employee can leave the firm.

While it’s highly unusual for public company executives to share profitability outlooks in their own capacity, Musk has been doing most of his investor information sharing on unusual platforms like Twitter. This has led him to his current standoff with the US Securities and Exchange Commission, which claims that the Tesla chief’s uses his tweets to communicate company disclosures to Tesla investors.

Tesla last traded at US$700.92 on the Nasdaq.


Information for this briefing was found via Reuters and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Goliath Resources Hits 10.60 g/t Gold Over 22.82 Metres, Highest Grade Results In Third Distinct Rock Package At Surebet Discovery

Four Countries Control the Fertilizer That Feeds the World | Sage Potash

$10,000 Gold Is Just A Question of Time | Florian Grummes

Recommended

ESGold Outlines $24.3 Million NPV For Tailings Reprocessing Project

First Majestic Encounters 711 g/t Silver Equivalent Over 8.0 Metres In Ongoing Exploration At Los Gatos

Related News

Twitter Engineers Working To Bring Vine Back Before End Of The Year

Elon Musk has reportedly told Twitter engineers to work on rebooting Vine by the end...

Tuesday, November 1, 2022, 03:07:00 PM

Musk Urges ISS Shutdown After Clash With Former Commander

Elon Musk called for decommissioning the International Space Station on Thursday after a social media...

Friday, February 21, 2025, 10:41:00 AM

Elon Musk Is Running Out of Ways To Get Twitter To Make Money, Reportedly Considering Username Auctions

Twitter’s new owner Elon Musk is finding more ways to make the company’s $44 billion...

Thursday, January 12, 2023, 12:54:28 PM

Musk Threatens to Go ‘Thermonuclear’ with Lawsuit, Media Matters Says It’s All ‘Meritless’

X owner Elon Musk took a swipe at advertisers for pulling their support from the...

Monday, November 20, 2023, 12:56:25 PM

‘Now He’s Awake’: Biden Admin Mulls Subjecting Elon Musk Deals To National Security Reviews

Almost one year ago, Elon Musk took a jab at US President Joe Biden, who...

Friday, October 21, 2022, 11:18:00 AM