Tesla is conducting preventive maintenance of its production line at its Shanghai plant, which is putting manufacturing on hold at the carmaker's first overseas facility.

"The workers are off as the annual maintenance work is conducted as planned," said the United States-based carmaker in a reply to China Daily.

However, it did not say when production will resume at the plant that produces the Model 3 sedans and the Model Y SUVs.

Reuters reported on Saturday that the Tesla plant suspended production, citing an internal notice and two people with knowledge of the matter.

"The US automaker told all workers on Saturday at its most productive manufacturing hub they could start their break", said the Reuters report, citing the COVID-19 and Tesla's elevated inventory level in China.

A Tesla China representative told China Daily that the report is "not accurate" because production has not stopped at the plant's charging pillar workshop.

Tesla is the most popular foreign electric carmaker in China. It sold over 100,000 vehicles in the country last year, up 89 percent year-on-year.

Its Shanghai plant produced over 650,000 vehicles in the first 11 months of the year, said the China Passenger Car Association.