The world is slowly gravitating toward more environmentally sustainable solutions to transportation. Electric cars have become the go-to solution for the automotive industry’s future.
Tesla, the renowned electric automaker has aggressively expanded its footprint with warehouses and manufacturing plants.
So where exactly are Tesla cars made? Let’s find out.
The electric automaker has a very refined goal for their ideal plant. The idea is to have vertically integrated plants that are massive. This approach to mass production was met with ridicule.
However, Tesla’s plant in California has achieved a very coveted title. The title of the most productive auto plant in North America.
It produced more cars than 70 competing plants in North America. Elon has kept a similar vision for his future facilities.
At the time of writing, Tesla is operating four fully operational plants. Three facilities are located in the United States and the fourth is in China.
Some of the plants also produce battery and solar technology. Tesla is currently in the process of the fourth plant in North America.
A European gigafactory in Germany is also in the works. There have been speculations of a second Chinese facility.
Let’s take a deep dive into how Tesla expanded its facilities.
Tesla’s factory in Fremont is what started it all. It is tucked just outside San Francisco spanning 5.3 million sq.ft. of volume. The factory sits on 370 acres of land and provides employment to 10,000 people.
Fremont Factory was first home to General Motors from 1962 to 1982. GM partnered with Toyota to work on the factory. The partnership lasted until 2009. Tesla bought the facility in 2010 and made heavy modifications to the factory.
Fremont first rolled out the Model S in June 2012. The Model S forever changed the automotive landscape and kickstarted the frenzy toward EVs.
Tesla has since opened three more factory locations throughout the world. However, Tesla continues to rely on Fremont for the majority of its products. Fremont continues to build the Model S, Model X, Model Y, and Model 3.
It also manufactures the vast majority of each car’s components. Even more importantly, Fremont Factory plays a pivotal role in Tesla’s supply chain. Many suppliers have opened facilities near Fremont Factory.
Fremont Factory will continue to play a major role in Tesla’s supply chain. Reallocating to other locations will simply mean more time, work, and expenses for suppliers.
Tesla continues to prioritize global expansion, but these facilities will mostly cater to niche products.
Gigafactory 1 in Nevada
Gigafactory 1 located in Sparks, Nevada just outside Reno supplies electric vehicles and battery packs. It cost a whopping $5 billion to make and is home to affordable batteries.
Battery production, in particular, is prioritized at Gigafactory 1. In 2018, the facility reached an annualized rate of 20 GWh. This makes it the highest-volume battery plant in the world.
The factory mostly focuses on Model 3. However, it provides important products for Tesla’s Powerwall lineup.
Gigafactory 1 has a very modular design. According to Tesla, they define their production facility as a block. Each block should be operational right after construction. Construction for the facility started in late 2014, and by 2015, Tesla was in business.
In 2021, Gigafactory 1 had produced a total of 1 million EV battery packs. This milestone would be a major success story for Tesla and its electric vehicles.
However, Tesla has big plans for their facilities and a lot more planned ahead. The Nevada facility has allowed Tesla to overcome its biggest challenges. Gigafactory 1 finally gave Tesla the breathing room it needs to focus on in the future.
Tesla’s acquisition of SolarCity and a $950m state investment would lay the groundwork for Gigafactory 2. Part of the deal with the state was to create a certain number of jobs. Tesla was also required to invest in the region.
Tesla began producing solar cells in 2017 at the 1.2 million-square-foot facility. A few years later, Tesla was able to introduce new production lines.
They were required to invest in more non-solar activities to comply with state requirements. Tesla hired 250 people to work on its Autopilot project and self-driving efforts. In a few months, Tesla was able to employ over 1000 people at Gigafactory 2.
Tesla also pivoted to power electronics production for their hiring efforts. Despite achieving their investment requirements for the project, Tesla was still way off. Tesla made multiple attempts to restructure its activities at Gigafactory 2.
This includes a deal with Panasonic to produce solar models. The deal failed, including its ambitions to produce Supercharging stations at the factory. This may have dashed Tesla’s hopes of making good on its promise to the state.
Tesla secured an extension from the state to achieve its goal by the year’s end. It is worth noting that Tesla’s primary goal at the factory was to produce EVs. Its priority was the production of the less expensive EV, the Model 3.
Most of the setbacks that Tesla has had to face are because of the pandemic.
A key reason why Tesla struggled on its solar projects is because of the sheer resources. Tesla underestimated how difficult it would be to install Solarglass on unconventional roofs. To reflect this growing difficulty, the company has increased the price of the solar roof.
It now requires homeowners to put in a battery storage system using Tesla’s Powerwall batteries. This would make installation simpler and less dependent on electricity from the grid.
It should be noted that 2020 was a bad year for automakers around the world. However, Tesla was able to expand its global production by 83%.
Gigafactory 3 in Shanghai
Giga Shanghai is one of the newest facilities that Tesla is operating. It is the second factory ever to assemble Tesla cars. The gigafactory occupies a space of over 9.3 millions sq.ft. It assembles and produces the Model 3 and Model Y.
Gigafactory 3 is a major success story for Tesla. In fact, it took only 15 months to complete and set numerous records.
Regulatory bodies in China were very cooperative with Tesla’s goals. This isn’t to say that Gigafactory 3 is without its setbacks. The company had to temporarily shut down production due to the pandemic.
This limited the production of Model Y and Model 3 vehicles.
The original goal of Giga Shanghai was to work on Tesla’s cheapest car, the Model 3 sedan. Since then, the Gigafactory has doubled its ability to produce the Model Y.
With Giga Shanghai, Tesla is hoping to recruit more local talent. It has hired Chinese designers and experts to create Tesla vehicles. More specifically, Tesla wants to assemble vehicles for use in China.
Gigafactory 3 is part of Tesla’s overarching goal to become the largest export hub globally.
Tesla had made phenomenal progress with Gigafactory Shanghai. According to their February reports, the automaker has maintained an output of 600,000 EVs. Tesla is rolling out new improvements to the production process.
Once rolled out, the updates would ramp up the production to over 1 million units. Some rumors have it that it could possibly push the volume to 2 million Teslas.
The China Passenger Car Association (CPCA) revealed that Tesla sold over 56,000 EVs in China. 33,300 of those vehicles were eventually exported out of the country.
All this remarkable progress drew suspicion that Tesla had plans to further expand in China. These rumors continue to be speculative in nature.
Tesla’s factory in Europe is currently under construction. It was announced in 2019 by Elon Musk and is poised to make advanced EVs. Construction of the Gigafactory was completed on 22 March 2022.
The main focus of Giga Berlin will be on the Model Y. Tesla hopes to reach a goal of 500,000 annual vehicles from Berlin.
The project has drawn its fair share of criticism. Among these is the potential impact to the local water supply and wastewater disposal. A major point of contention is how the company would handle sewage and hazardous chemicals.
Local activists were unhappy about the facility’s water requirements. They also protested about the number of trees that were cut down to make room.
Gigafactory 4 struggled to secure granting permits for the projects.
However, despite all the hurdles, Elon sees this as a positive. Tesla hopes to produce up to 500,000 EVs from Gigafactory 4.
Until now, Tesla has relied on exports from China to service their European customers. For now, the Berlin factory is aiming for an output of 2000 vehicles per week.
Tesla has struggled to keep up with demand for Model Ys and Model 3s in certain parts of the world.
Demand for EVs is high in Europe, driven by government mandates to phase out fossil fuels. The production of Teslas in Europe will ease the burden on the supply chain.
Construction for Tesla’s new facility is currently underway in Austin, Texas. A few vehicles have been produced at the site, including Model Y.
The facility, named Giga Texas, is planned to be the main factory for Tesla Cybertruck. It will produce the Semi, Model 3, and Model Y to serve the Eastern United States.
Giga Texas is the second-largest building in the world by volume. It also happens to be the second biggest factory by size in the US.
Tesla reportedly spent an estimated $5 million to purchase the land outside Austin. The gigafactory sits on 2100 acres of land, conveniently close to a nearby river. It took another $1.1 billion to build the plant.
The construction of the Gigafactory is expected to boost Tesla’s capacity. Tesla hopes to produce 1.5 million EVs in 2022. This is a 50% increase from 1 million vehicles last year.
The long-awaited Cybertruck will be made at Giga Texas.
Tesla has made certain promises to the state and locals. For one, it will hire about 5000 workers at an average salary of $47,000. Entry-level positions start at $35,000.
In exchange for all this commercial activity, the Texas government will provide tax breaks. The company will also provide incentives to the company worth millions of dollars.
In 2020, a local school district approved $50 million in tax breaks for Texas.
Just like in Berlin, Tesla’s expansion was met with mixed reactions. Local environmentalists brought up water pollution, traffic congestion, and construction dust.
Much of what Tesla will continue to do in the future is up for speculation. Elon Musk often uses Twitter to announce his plans for the company. More notably, Elon Musk entertained the possibility of a Gigafactory in Asia.
In a Tweet, Musk explained that he first expects to finish the second US Giga. This is in reference to the gigafactory in Texas.
Experts believe that the next site for Tesla cars would be Japan or South Korea. A Giga Japan makes logistical sense because the country is close to China. More importantly, it is closer to Tesla’s battery manufacturer, Panasonic.
Keep in mind that this is only speculation. However, it makes a lot of sense.
The second option would be to choose South Korea. This is primarily because of the country’s batteries. Although Tesla relies on Panasonic for their batteries, they have expanded to other suppliers. One of these is LG Chem in South Korea.
More importantly, Samsung SDI in South Korea, has promised to produce 4680 battery cells. Finally, Japan is very close to both South Korea and Shanghai. So these two countries make the most logistical choice for Tesla’s future expansions.
Tesla has been reached out by leaders in the UK for a Gigafactory. They’ve promised Musk that Tesla won’t face any obstacles or delays, unlike Germany. Tesla and Musk have not acknowledged their plans to expand in the UK. It is more likely that Tesla will continue its expansion in Asia.
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