Tesla Gigafactory Berlin Halts Operations Amid Environmental Protests

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Key Takeaways

  • Tesla has temporarily shut down its Berlin Gigafactory for one day.
  • The factory was previously disrupted by an arson attack attributed to environmental activists.
  • The closure adds to a series of 2024 challenges for Tesla, including production disruptions and rising competition.

Tesla has temporarily halted operations at its Berlin Gigafactory due to impending protests.

Initially, it was reported that the shutdown would last four days. However, Andre Thierig, Senior Director of Manufacturing at Giga Berlin, has cleared the air on X. He stated that it will only last one day.

Environmental groups, who have been vocal about their opposition to Tesla’s expansion of the Berlin Gigafactory, are behind the protests. In anticipation of the protests, Tesla instructed all employees to work from home following the May 8 night shift.

Earlier this year, the Berlin Gigafactory was the target of an arson attack that resulted in a power outage and a week-long production halt. The activist organization Volcano Group claimed responsibility for the attack, citing environmental concerns.

This latest shutdown occurs amidst a worrisome dip in Tesla’s first-quarter earnings, partly attributed to the arson attack at the Berlin factory. Data from the European Automobile Manufacturers Association also show that Tesla’s new car registrations in the European Union dropped by 4.7% in the first quarter to 66,203 units.

Despite these setbacks, Tesla is poised to continue its expansion in Berlin. The company plans to double the plant’s capacity for battery production to 100 gigawatt hours and car production to 1 million units per year. However, The Guardian reported last February that these plans have faced opposition from local citizens, who voted against Tesla’s proposal to cut down trees for factory expansion.

Tesla’s 2024 Struggles Continues

The temporary closure of the Gigafactory is just one of the obstacles Tesla faces in 2024. In recent months, the EV giant has faced many challenges, with all eyes on the company’s management and investors to see how these disruptions will affect future earnings and production targets.

According to Reuters, Tesla had to suspend some European production in January after attacks on ships in the Red Sea led to a component shortage.

In addition to these challenges, stiff competition is brewing in China through BYD, which resulted in Tesla hitting a new 18% low in sales in the Chinese Market.

Beyond China, CNN reports that high interest rates and the rise of cheaper EVs may be sapping global demand and eating into Tesla’s market share. In 2024, Tesla’s stock price has seen a shocking decline by about 30% due to underwhelming sales figures and profits. CNN currently ranks it among the poorest performers in the S&P 500.