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Tesla pauses production at German factory due to Houthi Red Sea attacks
The disruption in the crucial global shipping corridor has forced shipping companies to reroute vessels, leading to longer transport times
In response to the recent attacks by Yemen's Houthi rebels in the Red Sea, Tesla has announced a temporary halt to most production at its German factory, affecting the manufacturing of Model Y vehicles and batteries.
The disruption in the crucial global shipping corridor has forced shipping companies to reroute vessels, leading to longer transport times and impacting manufacturing supply chains worldwide.
The electric vehicle giant released a statement on Thursday night, stating that production at its factory near Berlin, known as Giga Berlin or Giga Grünheide, will be paused from January 29 to February 11.
This decision reflects the broader challenges faced by industries as geopolitical conflicts affect key shipping routes, leading to delays and operational issues.
"The armed conflicts in the Red Sea and the associated shifts in transport routes between Europe and Asia via the Cape of Good Hope are also affecting production in Grünheide," Tesla explained. "The significantly longer transport times create a gap in the supply chains."
Shipping companies have reported being compelled to redirect vessels on an extended route around the southern tip of Africa, adding at least 10 days to the journey. The increased transport times have created logistical challenges for companies reliant on timely deliveries of goods and components.
The U.S.-led airstrikes on Thursday targeted Yemen's Houthi rebels in response to their attacks on Red Sea shipping, reflecting the broader impact of geopolitical tensions on global trade and manufacturing.
Normal operations at the German facility are expected to resume on February 12. The Grünheide factory, located southeast of Berlin, is Tesla's first manufacturing plant in Europe, inaugurated in 2022, and employs around 11,000 workers.