Now that Tesla has dropped its prices in multiple global markets, including China and the US, it's reportedly seeing massive demand. Based on information from a new report shared by Electrek, the EV maker has plans to dial up production in China to around 20,000 units per week.
Tesla's Giga Shanghai factory in China has impressed with its output and efficiency, and the automaker made notable upgrades toward the end of 2022, making the factory even more efficient. While the upgrades would allow Tesla to ramp up production significantly, the automaker decided not to push it to the max in 2022, which caused concern for some folks, as it signaled potential demand issues.
Tesla offered incentives at the end of last year to help boost sales, and while they likely helped, it wasn't until the more recent price cuts that demand seems to have spiked so significantly. Giga Shanghai is arguably the US electric automaker's most crucial factory since it not only supplies EVs to the largest domestic auto market in the world but is also Tesla's primary export hub.
We've already seen drone footage of loads of Tesla EVs being loaded onto carrier ships to head to new owners. Many of the vehicles produced at Giga Shanghai have made their way to Europe. While Tesla has a newer factory in Germany, it's still ramping up production, and it only currently produces the Model Y crossover.
When Tesla was being heavily scrutinized for the potential drop in demand for its vehicles, it seemed interesting that it would continue upgrading existing factories to boost output, not to mention opening and ramping up new factories while looking for sites for more to come. However, CEO Elon Musk mentioned on a few occasions that Tesla's delivery wait times were getting ridiculous. He also said he hoped to reduce prices as they were getting quite high.
At any rate, Tesla produced some 80,000 EVs at Giga Shanghai in China in September 2022, after which production output began to drop. Even after the factory upgrades would allow Tesla to produce at a notably higher rate, it wasn't making more cars.
According to a recent report by Reuters based on an internal "planning memo," Tesla will bump up its weekly average production rate to about 20,000 units for the months of February and March. Reuters claims it obtained access to the memo, but we have no proof of those claims.
Tesla typically produces EVs at Giga Shanghai for export at the beginning of the quarter before honing in on local deliveries. However, there's no way to know for sure if the EV maker is done exporting for Q1 2023 since January is behind us, or if some of the increased production will head overseas. Regardless, based on reports about the price cuts in China, it appears Tesla has plenty of domestic orders to fill.