Tesla might file for bankruptcy, according to Elon Musk, who recently spoke with a group of Tesla owners. Tesla has recently encountered a number of issues, including Shanghai manufacturing closures resulting from the pandemic and supply chain interruptions that have an impact on the manufacture of its cars. According to CNN, Musk stated in the interview that the previous two years had been “an utter nightmare with supply chain delays, one thing after another.”
“We’re still not out of it. How can we keep the plants running so we can pay the workers and avoid going bankrupt? That largely what we’re worried about.” Musk was referring to the two gigafactories that Tesla constructed this year: the Austin, Texas facility, which opened in April, and the Berlin plant, which opened in March 2022. The billionaire allegedly stressed the threat to the Austin facility, pointing out that supplies and components for cars were “locked” in Chinese ports, preventing manufacturing from reaching the anticipated level.
After reporting $18.76 billion in sales in the first quarter of 2022, topping forecasts, Tesla is coming off a profitable period that propelled its shares up over 6%. According to Tesla CFO Zachary Kirkhorn, manufacturing of all Tesla cars was “resuming at restricted levels” at the time of the revelation, but closures at the Shanghai facility caused by Covid cost the automaker a month’s worth of “build volume.”
Kirkhorn said, “We’re aiming to return to full production as soon as we can. Tesla has lately taken significant steps to reduce expenses, with Musk announcing in an email that was leaked earlier this month that the business will be laying off 10% of its workers. He acknowledged in the message that the economy gave him a “very awful feeling,” and he also informed Tesla executives that the business will “halt all international recruiting.”
When questioned whether or not the United States was heading for an economic recession, Musk used the word on Twitter last month. Musk has previously spoken about the idea of bankruptcy in general. “For too long, money has been pouring down on the foolish. There must be some bankruptcies, “Musk posted something on the website. It’s unclear whether he was making a reference to the future of his own business at the time. Late Friday morning, Tesla had increased by around 7% over the previous year.