Tesla's Giga Texas Ramps Up Cybertruck Production: Report

Tesla's Gigafactory in Texas is witnessing an uptick in production, particularly for the Cybertruck, since its inaugural delivery event in November. Drone footage by observer Joe Tegtmeyer showcased the bustling activity, capturing both Cybertruck and Model Y units in the outbound lot.

Tegtmeyer reported a notable increase in Cybertruck production volume compared to the previous week. However, counting the trucks has become challenging as they are swiftly loaded and shipped immediately upon exiting the factory. The transportation pace is notably rapid, encompassing not only Cybertrucks but also Model Y units, Teslarati reported.

The Cybertruck, which commenced deliveries at Giga Texas on November 30, initially saw a limited release of the "Foundation Series" versions. Subsequently, more units have found their way into the hands of Tesla employees and celebrities.

Tesla's CEO, Elon Musk had previously provided expectations for the ramped Cybertruck production during Q3 earnings call when he said that it would be 12 to 18 months before reaching volume manufacturing and positive contributions from cash flow.

Tunneling Project Spotted

Beyond the vehicle production update, the drone video also unveiled intriguing construction details. Tegtmeyer highlighted a potential shield holder-transporter or concrete liner installation figure, suggesting plans for a tunneling project at the factory. Further analysis indicated similarities to equipment from The Boring Company's Prufrock tunneling system. Tegtmeyer delved into the hardware specifics, referencing a permit discovered at The Boring Company facility in Bastrop, Texas, and exploring the implications for Giga Texas.

The continuous progress in Cybertruck production and the potential tunneling project underscore the dynamism at Tesla's Giga Texas, offering a comprehensive view of the developments shaping the electric vehicle manufacturer's future.

Red Sea Crisis Downs Tesla Stocks

In a related development, the Red Sea crisis' impact on supply chains and further vehicle price cuts in China caused Tesla's stock to decline by up to 4% on Friday morning, according to CNBC. In the US, escalating labor costs and Hertz's decision to divest a significant portion of its electric vehicle fleet contributed to Tesla's challenges.

Tesla intends to halt most production at its Grunheide factory near Berlin, Germany, from approximately January 29 to February 11 due to the conflict in the Red Sea. The ongoing attacks by the Iranian-backed Houthi militia group on cargo ships and merchant vessels in the Red Sea, as a response to the Gaza Strip war, have disrupted global trade, leading to longer transportation times and creating a gap in supply chains, according to a statement by Tesla.

Analysts from Baird estimate that Tesla's German assembly plant produces between 5,000 and 7,000 vehicles per week, projecting a potential impact of "a 10k-14k hit" on deliveries in the first quarter. The Baird analysts expressed caution regarding additional effects on Tesla's supply chain and are closely monitoring potential disruptions in shipping routes from China, although no delays have been reported yet. The Red Sea disruptions may lead to extended wait times as supply chains are rerouted, according to the Baird note.

These challenges, coupled with other market dynamics, have contributed to the temporary decline in Tesla's stock value.

According to Reuters, certain operators of tanker vessels decided to cease navigating through the Red Sea in response to airstrikes carried out by the US and British forces against Yemen's Houthi group. This cautious approach by some tanker operators is a response to the widening regional conflict stemming from Israel's engagement in the Gaza war.

Additionally, contributing to the challenges in trade logistics, the Panama Canal is experiencing reduced crossings due to low water levels caused by drought, impacting another crucial maritime trade route.