Tesla stopped production due to shipping problems in the Red Sea. The company announced that it will close its Gigafactory in Berlin for two weeks, that is, from January 29 to February 11, due to a lack of spare parts.
Tesla Berlin will take a 2-week break due to the Red Sea blockage!
The Red Sea is an important trade route connecting Asia and the Mediterranean. In particular, the Suez Canal carries a significant portion of one-third of global trade. That’s why this channel is of vital importance for shipping.
So, have such problems occurred before? Of course, there have been supply disruptions in the Red Sea before. Piracy, especially during the Somali Civil War in the 2010s, was a major cause of these disruptions. However, thanks to international cooperation and intervention, piracy has been largely prevented. That’s why supply disruptions in the Red Sea have been greatly reduced today.
But to reach the Red Sea, ships must pass through the Bab al-Mandeb Strait on Yemen’s southeastern coast. Yemen is one of the poorest countries in the world and has been facing a decade-long civil war.
The main reason for these problems is actually the war between the Saudi Arabia and US-backed Yemeni government and the Iran-backed Houthi group. In response to Israel’s recent attacks on Gaza and this situation, the Houthis announced that they had blockaded the Bab al-Mandeb Strait and would attack commercial ships entering the Red Sea.
Additionally, global shipping companies have stopped using the Suez Canal due to security concerns in the Red Sea. This requires ships to sail around southern Africa via the Cape of Good Hope. But there’s a problem: this is a much longer route than transiting the Suez Canal and means a journey that takes additional weeks.
These situations also hit Tesla. Security concerns in the Red Sea and the civil war in Yemen will cause significant delays in the supply of vehicle parts to the Company’s Berlin factory. Therefore, the company will have to stop most of its vehicle production for two weeks from the end of the month.
Global shipping companies predict that supply disruptions caused by security concerns in the Red Sea and the civil war in Yemen will continue in the coming period. Therefore, they advise companies to review their inventory management and make their supply chains more flexible.
The blockage in the Red Sea significantly affects the global trade chain. The production halt at Tesla’s Berlin factory is a concrete example of these effects.
This highlights the fragility of supply chains and the potential impact of regional conflicts on the global economy. The continuation of these problems will affect many technology and automobile companies.
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