# Tesla stutters under tighter Shanghai lockdown; Beijing keeps hunting COVID Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-05-10 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Tesla struggles to increase production in China under COVID Meta Description: Factories in Shanghai and Beijing deal with Covid restrictions causing delays in production, impacting global supply chains and economy. URL: https://financedigest.com/tesla-stutters-under-tighter-shanghai-lockdown-beijing-keeps-hunting-covidhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-05-10t071131z1lynxnpei4908jrtroptp4health-coronavirus-china-1736815749959-compressed.jpg) By David Stanway and Martin Quin Pollard SHANGHAI/BEIJING (Reuters) -Tesla operated its Shanghai plant well below capacity on Tuesday, showing the problems factories face trying to ramp up output under a tightening COVID-19 lockdown, while China’s capital kept up its fight with a small but stubborn outbreak. Many of the hundreds of companies reopening factories in Shanghai in recent weeks have faced challenges getting production lines back up to speed while keeping workers on-site in a “closed loop” system. Even if they manage to get everything right, such firms depend on suppliers [facing similar challenges](https://www.financedigest.com/under-saved-and-underprepared-women-face-challenges-saving-for-retirement.html "UNDER-SAVED AND UNDERPREPARED: WOMEN FACE CHALLENGES SAVING FOR RETIREMENT"). The latest sign of the struggle trying to increase output under [COVID rules](https://www.financedigest.com/sterling-slips-as-boost-from-new-china-covid-rules-fades.html "Sterling slips as boost from new China COVID rules fades") came at Tesla’s Shanghai plant, where a resumption of work three weeks ago got extensive state media coverage as an example of what can be achieved despite restrictions. The U.S. automaker has [halted most of its production at the plant](https://www.financedigest.com/germanys-uniper-to-restart-coal-fired-power-plant-as-gazprom-halts-supply-to-europe.html "Germany’s Uniper to restart coal-fired power plant as Gazprom halts supply to Europe") due to problems securing parts, according to an internal memo seen by Reuters. Tesla had planned as late as last week to increase output to pre-lockdown levels by [next](https://www.financedigest.com/china-arrivals-in-uk-next-week-will-not-face-compulsory-covid-tests-independent.html "China arrivals in UK next week will not face compulsory COVID tests -Independent") week. Among [Tesla suppliers facing](https://www.financedigest.com/factbox-the-challenges-automakers-and-now-tesla-face-with-humanoid-robots-2.html "Factbox-The challenges automakers, and now Tesla, face with humanoid robots") difficulties is wire harness maker Aptiv after infections were found among its employees, sources said on Monday. Videos posted online last week showed dozens of workers at Apple and [Tesla supplier Quanta overwhelming hazmat-suited security](https://www.financedigest.com/tesla-to-warn-of-data-privacy-risk-from-car-security-cameras-in-germany.html "Tesla to warn of data privacy risk from car security cameras in Germany") guards and vaulting over factory gates fearing being trapped inside by a lockdown. [COVID curbs](https://www.financedigest.com/were-going-to-be-free-chinese-cheer-as-covid-curbs-are-loosened.html "‘We’re going to be free’: Chinese cheer as COVID curbs are loosened") in Shanghai, Beijing and dozens of other major manufacturing hubs across China are taking a heavy toll on the world’s second largest economy, with significant knock-on impacts on global trade and supply chains. [China’s export growth slowed](https://www.financedigest.com/swiss-gold-exports-to-china-slow-but-shipments-to-turkey-surge.html "Swiss gold exports to China slow but shipments to Turkey surge") to its weakest in almost two years, data showed on Monday. Unemployment was also [near two-year](https://www.financedigest.com/dollar-slides-from-near-two-year-high-amid-hawkish-signals-from-fed.html "Dollar slides from near two-year high amid hawkish signals from Fed") highs. Uncertainty is high, with economists unable to [say with any accuracy when the country will bring COVID](https://www.financedigest.com/the-icu-is-full-medical-staff-on-frontline-of-chinas-covid-fight-say-hospitals-are-overwhelmed.html "‘The ICU is full’: medical staff on frontline of China’s COVID fight say hospitals are ‘overwhelmed’") under control and what the final cost is likely to be. Growth in China is likely to remain hostage to the course of the [pandemic for most of the year,” analysts at Fathom Consulting said in a note](https://www.financedigest.com/uk-house-prices-end-2022-on-a-weaker-note-after-pandemic-boom.html "UK house prices end 2022 on a weaker note after pandemic boom"). [Chinese stocks](https://www.financedigest.com/chatgpt-mania-pumps-up-chinese-ai-technology-stocks.html "ChatGPT mania pumps up Chinese AI technology stocks") were just off two-year lows, and the yuan traded near 18-month lows on Tuesday. Shanghai, a vital centre for commerce, [finance and manufacturing for China and beyond with a population of 25 million](https://www.financedigest.com/optable-closes-20-million-series-a-financing-broadens-investor-syndicate-in-new-round.html "Optable Closes Million Series A Financing, Broadens Investor Syndicate in New Round"), was enduring its sixth week of a city-wide lockdown. The prolonged isolation increasingly jars with an outside [world which is gradually returning](https://www.financedigest.com/certainty-in-an-uncertain-world-post-brexit-investors-turn-to-commercial-property-and-fixed-returns.html "Certainty in an uncertain world – post-Brexit investors turn to commercial property and fixed returns") to its pre-COVID way of life, even if cases spread. [China has threatened actions against critics of its “dynamic-zero COVID”](https://www.financedigest.com/who-urges-china-to-share-specific-data-regularly-on-covid-situation.html "WHO urges China to share specific data regularly on COVID situation") policy, which it says aims to “put life first” and prevent a death toll like ones seen around the world. BEIJING ON HIGH ALERT Testing was becoming daily routine in much of [Beijing and other places in China](https://www.financedigest.com/as-beijing-battles-outbreak-china-warns-zero-covid-doubters.html "As Beijing battles outbreak, China warns ‘zero COVID’ doubters"). The capital has not seen its daily case numbers [grow beyond](https://www.financedigest.com/the-drug-repurposing-market-to-virtually-grow-beyond-geographies.html "The Drug Repurposing Market to virtually grow beyond geographies") several dozen since its latest outbreak began on April 22. But it has also found it difficult to bring them down significantly. So [restrictions have gradually tightened](https://www.financedigest.com/shell-tightens-restrictions-on-russian-oil-buying.html "Shell tightens restrictions on Russian oil buying"). An area in the southwest of the [capital on Monday banned residents from leaving their neighbourhoods and ordered](https://www.financedigest.com/austrian-regulator-orders-system-relevant-banks-to-up-capital-buffers.html "Austrian regulator orders system-relevant banks to up capital buffers") all activity not related to virus prevention to stop. Elsewhere, some residents have been told to [work from home; dine-in services at restaurants were banned; parks, some malls and other venues were shut; some bus and subway routes were curtailed; isolated lockdowns were enforced on some buildings](https://www.financedigest.com/savile-row-designer-on-working-from-home-winter-attire.html "Savile Row Designer on Working From Home Winter Attire"). The number of new [COVID cases in Shanghai](https://www.financedigest.com/in-shanghai-lockdown-blues-make-way-for-covid-testing-gripes.html "In Shanghai, lockdown blues make way for COVID testing gripes") has been falling for almost two weeks, but remains in the thousands and restrictions are tightening. We are still in a critical period of epidemic prevention,” said Sun Xiaodong, [deputy director](https://www.financedigest.com/statement-by-imf-first-deputy-managing-director-david-lipton-on-meeting-with-egypts-president.html "Statement by IMF First Deputy Managing Director David Lipton on Meeting with Egypt’s President") of the Municipal Centre for Disease Control. FINAL PUSH The city was making what it hoped was a final push to [end infections outside areas under the strictest curbs – the most significant gauge of whether](https://www.financedigest.com/graphic-chip-price-drop-raises-questions-on-whether-end-of-shortage-is-in-sight.html "Graphic chip price drop raises questions on whether end of shortage is in sight") the virus was being brought under control. Many residential compounds have received notices that people would no longer be allowed out, having been able to go for brief walks or quick grocery trips previously. In some cases, entire communities have been sent into quarantine after just one member [tested positive](https://www.financedigest.com/biden-tests-positive-for-covid-has-mild-symptoms-taking-paxlovid-treatment.html "Biden tests positive for COVID, has mild symptoms, taking Paxlovid treatment"). Ruthless enforcement has fuelled resentment. A former Southern Weekender journalist, Lian Qingchuan, described in a WeChat post how he tried in vain for several days to convince authorities to let him visit his dying mother in another province without having to quarantine first. His mother died before he could see her, which, he said, filled him with rage. “I wanted to be a filial person, but they have turned me into an ungrateful person who is worse than a beast,” he wrote in the post, which was taken down soon after it appeared. “I know exactly who my enemies are.” He declined comment when contacted by Reuters. (Reporting by the Beijing and Shanghai bureaus; Writing by Marius Zaharia; Editing by Simon Cameron-Moore) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---