Tesla stumbles over ‘Just-in-Time’ logistics and suspends production at its Brandenburg, Germany Gigafactory for two weeks as Iran-backed drone and missile attacks on cargo ships in the Red Sea interrupt supply chains.
Delays to components coming to Europe from the East caused by Shiite Islamist militias in Yemen attacking merchant ships attempting to transit the Red Sea means Tesla has been forced to suspend production at their Gigafactory in Grünheide, Brandenburg on the outskirts of Berlin. The stoppage is expected to last two weeks, the company said per Gemran broadsheet Die Welt.
Production is slated to restart on February 12th at the 11,500-employee factory, they said.
Houthi Red Sea Attacks: Retailers Warn of Shortages and Price Rises as Imports Slow https://t.co/Wb2q6NMIjS
— Breitbart London (@BreitbartLondon) January 5, 2024
Attacks on cargo ships carrying goods from the workshops of China and the Pacific to Europe through the Red Sea have been ongoing since Hamas launched its massive terror attack on Israel in early November. Houthi militias in Yemen, which are equipped by and operate as a proxy for the Iranian regime, launched attacks on passing ships in solidarity with Hamas, claiming they were targeting Israel-linked ships, although attacks have since devolved to general attacks on the global trade that underpins the prosperity and security of the West.
While warships have intercepted most drone and missile strikes heading for merchant shipping in the area, the huge expanse of sea and length of Yemen coastline involved means some attacks have got through and damaged ships, and piratical boarding raids have been attempted, with a large car carrier captured. This risk has seen maritime insurance rates soaring and thousands of ships divert away from the area, to take the ‘long way around’ to Europe by the southern tip of Africa.
The longer route adds over a week to the delivery time from Asia to Europe or the U.S. East, which not only creates supply bottlenecks for businesses that rely on efficient but fragile Just-in-Time delivery for components, as Tesla is now discovering, but also increases the overall cost of shipping for all users as it saps capacity from the global system.
A coalition of Western nations, principally the United States and the United Kingdom, warned the Houthi fighters that continuing the strikes against merchant shipping would incur “consequences”. Nevertheless, the Houthis launched their largest attack yet this week, attempting to strike both merchant shipping and the warships detecting them in the Red Sea with 21 drones, cruise missiles, and even a ballistic missile on Wednesday. U.S. Navy and UK Royal Navy ships shot down all threats in that wave, they said.
The U.S. and UK unleashed the response to that and the 27 other Houthi strikes on the Red Sea since November overnight Thursday into Friday, launching against 60 targets at 16 sites in Yemen. The UK said on the damage caused: “The detailed results of the strikes are being assessed, but early indications are that the Houthis’ ability to threaten merchant shipping has taken a blow”.
The consequences of car component shortages are already well known, given the impact on the so-called ‘chip shortage’ experienced by manufacturers in the Covid era and beyond, which saw over one million fewer cars built in the U.S. in a year and car prices soar due to constrained supply.
Progress on Tackling Inflation May be Wiped Out by Houthi Attacks on Cargo Shipshttps://t.co/3IU9rHzGBz
— Breitbart London (@BreitbartLondon) December 26, 2023