Tesla Germany halts work

Tesla’s European Gigafactory near Berlin has halted work until further notice after what CEO Elon Musk called an “extremely dumb” suspected arson attack nearby left it without power on Tuesday.

The attack southeast of the German capital set an electricity pylon close to the site ablaze, but the fire did not spread to the Tesla facility – the U.S. electric vehicle maker’s first manufacturing plant in Europe.

It has however shuttered production at least until early next week, the company said.
The outage will cost Tesla estimated losses in the high hundred of millions of euros, with 1,000 vehicles left unfinished on Tuesday alone.

A company official was noncommittal on whether this would affect plans to double capacity at the site, but condemned what he saw as negative sentiment towards it.

Emergency services have extinguished the blaze, and power to the surrounding communities has mostly been restored.

Joerg Steinbach, the economy minister of Brandenburg, the German state where Tesla’s plant is based, condemned the suspected attack as having “terrorist markings”, and hitting tens of thousands of people.

“This includes hospitals, homes for the elderly, where people may also be dependent on oxygen supply or similar, which is electricity-based,” he said at a briefing outside the factory.

The Tesla site, which employs around 12,500 people, was evacuated and most employees sent home. Tesla shares were down 3% at 1522 GMT.

Local media published a letter purportedly from a far-left activist organisation called the Volcano Group that claimed responsibility for the incident, in a 2,500-word attack on Tesla and its billionaire CEO Musk.

Police said they were aware of the letter, which was signed “Agua De Pau”, the name of a volcanic mountain in the Azores, and said they were checking its authenticity.

“These are either the dumbest eco-terrorists on Earth or they’re puppets of those who don’t have good environmental goals,” Musk said on X.

“Stopping production of electric vehicles, rather than fossil fuel vehicles, ist extrem dumm,” he said, using the German for “extremely dumb”.

The attack was the latest setback for Tesla, which has had a bumpy ride in Europe of late, facing union pressure for collective bargaining agreements in the Nordics and supply disruptions as a result of attacks on shipping in the Red Sea.

Germany has championed new big-ticket foreign investments at a time when Europe’s largest economy is facing recession and grappling with higher inflation and weaker foreign demand.