Tesla's German Plant to Temporarily Halt Production Due to Supply Delays Caused by Red Sea Attacks

Tesla intends to temporarily halt the majority of production at its sole European factory due to supply chain disruptions caused by incidents in the Red Sea.

The company announced that it will suspend operations at its large factory near Berlin for a period of two weeks starting on January 29. This decision was made in response to delays in component delivery caused by attacks on ships along the important trade route, as reported by CNN affiliate RTL on Friday.

Tesla did not provide a comment in response to a request from CNN. The Grünheide factory has the capacity to produce 375,000 cars annually for customers in Europe. According to RTL, Tesla (TSLA) intends to completely resume production on February 12.

Recently, Houthi militants from Yemen have increased their attacks on ships passing through the Red Sea, citing retaliation for Israel's conflict with Hamas in Gaza. This has led to six of the world's top 10 shipping companies, including Maersk, MSC, Hapag-Lloyd, CMA CGM, ZIM, and ONE, either significantly reducing or completely avoiding the Red Sea. As a result, ships are being rerouted around the Cape of Good Hope in South Africa, causing delays of up to three weeks.

This is a developing story and will be updated.