Tesla looks to ensure local suppliers’ production amid China’s power cuts

Tesla’s Gigafactory Shanghai currently gets a lot of its supply from local companies, but amidst China’s power cuts in Sichuan province, some suppliers are at risk of having their lights turned off. Fortunately, it appears that Tesla has some support from the Shanghai government to help the company ensure its local suppliers’ production. 

The Shanghai Municipal Commission of Economy and Informatization sent a letter to Sichuan authorities earlier this week, asking the province to prioritize access to power for 16 local suppliers that provide vehicle parts to Tesla and domestic automaker SAIC Motor. By doing so, the stability of the automakers’ supply chain can be ensured. 

“Tesla and SAIC Motor have raised their concerns to us recently that their key auto parts suppliers are affected by the partial power restrictions in Sichuan, which will impact the assembly of their vehicles. Please reduce the power restriction time during the day for the suppliers mentioned above,” the letter read, according to a Nikkei Asia report.

Tesla China is yet to issue a direct statement on the matter. 

Sichuan is home to a good number of automotive suppliers, but as the province was hit with the worst heat wave in 60 years, its power grid has been overstretched. As temperatures reached over 40 C (104 F), the province started to limit the electricity supply to homes, offices, and malls. 

As per a report from Bloomberg, Tesla China is actively coordinating with the Shanghai and Sichuan governments to ensure its local suppliers’ power. Citing people familiar with the matter, the publication noted that Tesla’s suppliers are yet to see any production delays from the province’s power cuts as of now. A spokesperson from SAIC Motor, on the other hand, noted on social media that the company is “actively coordinating with the local government of Sichuan.”

The Shanghai authorities’ request has been spread widely on Chinese social media, where it incited some backlash from users residing in Sichuan province. While some users argued that regular citizens also need power due to the ongoing heat wave, others have suggested that the Shanghai government is simply looking after its own interests by having Sichuan prioritize suppliers of Shanghai-based companies like Tesla.