Tesla Inc TSLA plans to halt most of its production at Giga Shanghai in the first two weeks of July to upgrade the site, Reuters reported on Wednesday, citing an internal memo.
What Happened: The Elon Musk-led company plans to ramp up production at Giga Shanghai after the upgrade to a new record high by the end of July and get closer to its goal of producing 22,000 cars per week.
Austin, Texas-based Tesla has been producing 17,000 Model 3 and Model Y cars a week since mid-June from Giga Shanghai, the report said.
Tesla planned to make 8,000 Model 3s and 14,000 Model Ys per week at Giga Shanghai by mid-May, a plan that was delayed following a two-month-long COVID-19 lockdown.
The report estimated production at the Tesla Shanghai factory is on track to fall by over a third this quarter from the first three months of the year.
Why It Matters: Tesla had in early May resumed over 80% of production at Giga Shanghai as part of efforts by Beijing to resume manufacturing activity in a staggered manner.
The EV maker was however forced to halt production a week later due to supply chain issues.
China’s month-long extensive lockdowns in March to curb COVID-19 cases brought automotive and other production activity to a near standstill.
Price Action: Tesla closed 0.4% lower at $708.3 on Wednesday, according to data from Benzinga Pro.