Elon Musk (left) announces plans to build a Tesla Gigafactory near Berlin at “Auto Bild” magazine's ... [+]
Tesla is still putting the finishing touches on its first Chinese auto plant, but that isn’t stopping billionaire CEO Elon Musk from unveiling plans for a European Gigafactory to be built in Germany, at some point, along with design and engineering operations near Berlin.
Musk made the announcement while in Berlin attending Auto Bild magazine’s Golden Wheel Award ceremony Tuesday without providing details, including how much the factory will cost and the timing of its construction.
“Everyone knows that German engineering is outstanding, for sure,” Musk said. “That’s part of the reason why we are locating our Gigafactory Europe in Germany. We’re also going to create an engineering and design center in Berlin.”
Pressed to share more about his plans, he said, “There’s not enough time to tonight to tell all the details.” The company also didn’t respond to a request for additional information. Still, Tesla may have already secured at least some of the land needed as Musk said that it will be “in the Berlin area and it’s near the new airport.”
In a follow-up tweet he said the facility would “build batteries, power trains & vehicles, starting with Model Y.”
Elon Musk via Twitter
Musk has talked about creating a global manufacturing footprint for Tesla for years, and with the new $2 billion Shanghai Gigafactory apparently close to beginning commercial production and a rebound in the company’s share price following a surprise third-quarter profit last month, he’s emboldened to map that out. Currently, all Tesla vehicles are built at its Fremont, California, plant, with batteries supplied by the company’s Gigafactory near Reno, Nevada.
Having a local production site in Germany will aid Tesla’s European sales, but it also ensures that capital expenditures will remain high for years to come. The company hasn’t completed construction of its multibillion-dollar Nevada Gigafactory that began in 2014 (which has also seen reports of high rates of worker injuries) and is only now completing work on the first phase of its Chinese facility.
Tesla has also struggled to fully utilize its solar-panel Gigafactory 2 in Buffalo, New York. Auditors for New York State, which provided more than $950 million of incentives to build that plant, currently value the facility and its equipment at just $75 million, according to recent media reports.
Tesla rose just under 1% to $347.58 in Nasdaq trading Tuesday.
