Tesla Inc. is suspending production at its Shanghai factory for two days as China tightens restrictions to contain the latest Covid outbreak, Reuters reported Wednesday, citing a notice to staff and suppliers.

Production at the plant will be halted on Wednesday and Thursday, and no immediate reason was given for the stoppage, according to the report.

Tesla didn’t immediately respond to a request for comment.

Elon Musk’s electric carmaker is the latest multinational to be caught up in China’s widening lockdowns and Covid restrictions. Although Shanghai has ruled out imposing a broad lockdown for now, workers in its main financial and business district have been urged to work from home as officials try to rein in a swelling outbreak. 

Concerns grow about supply chains

Authorities recently locked down Langfang, a city near Beijing’s new airport, as well as the southern tech hub of Shenzhen and the northeastern province of Jilin. That’s fueled concern the country’s financial gateway could be next.

Tesla’s Shanghai factory is crucial for Tesla, considering China is the company’s second-largest market and the plant produces cars for export to Europe and other parts of Asia. 

Data from the China Passenger Car Association earlier this month showed Tesla delivered 56,515 cars from the factory in February alone -- 23,200 for the domestic market and 33,315 for export.

The two-day production halt will likely apply to Tesla’s general assembly lines, according to Reuters. The notice to staff didn’t specify whether Tesla will be able to make up for lost output when operations restart, the report said.

See also

FAW, VW and Toyota suspended output at plants in Changchun

Volkswagen shifts more production to China, North America

BYD hikes prices after Tesla raised prices 2nd time in a week

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