Tesla is rapidly growing its worldwide manufacturing footprint.
The company is operating factories in California, Nevada, New York, and China.
A new plant is under construction in Germany, and Tesla just announced another factory will be built near Austin, Texas.
In just a few years, Tesla has become a global manufacturing juggernaut, supporting its goal of becoming the biggest provider of sustainable transportation and energy.
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I can remember a time when Tesla barely made any cars. That was back in 2010, when it had just taken over a former GM-Toyota plant near San Francisco. The only car for sale was the original Roadster, and just a few thousand had hit the road.
Fast forward to 2019, and Tesla had sold 250,000 vehicles in a single year, with the goal of doubling that total in short order.
The company’s growth is accelerating, but to satisfy demand for new and existing products, and to reach global markets more directly and at lower cost, it’s rapidly expanding its manufacturing capability. Four factories could be six in two years, as plants in Germany and Texas come online.
The scale that this expansion provides could enable Tesla to become more solidly profitable. But it could also increase the company’s already huge lead over its EV competition.
Here’s a closer look at how all these factories fit into the master plan, which goes beyond just cars:
Let’s start with Tesla’s factory in Fremont, CA, on the east side of San Francisco Bay.
Tesla bought the plant in 2010, after General Motors went bankrupt and slimmed down its assets. In a previous life, the factory was called New United Motor Manufacturing (NUMMI) and was jointly operated by GM and Toyota.
The factory has been humming away for a decade; it has a production capacity of 500,000, but thus far Tesla has only managed about half of that.
Benjamin Zhang/Business Insider
Currently, Fremont builds the Model S …
… The Model X …
… The Model 3 …
Hollis Johnson/Business Insider
… And the Model Y. There’s also a battery-making facility on site. The factory is the only car plant in California that’s operational.
Musk had said that in the future, Fremont could continue to make the Model S and Model X for US and global markets, as well as manufacture the new Roadster, a forthcoming redesign of Tesla’s first car.
Tesla’s second factory was the massive Gigafactory 1, near Reno, NV. This is where Tesla has partnered with Panasonic to manufacture battery cells, of which the company needs many.
In addition to battery packs for its vehicles, those cells are used for Tesla’s energy business — which sells both residential and utility-grade equipment.
Tesla also has a factory in Buffalo, NY.
Brendan McDermid / Reuters
This plant makes Tesla’s Solar Roof product.
We just learned that Tesla’s new US Gigafactory will be in the Austin, TX area. It sounds as though this plant could be as big as Fremont.
Roschetzky Photography / Shutterstock
Giga Austin will make the Cybertruck pickup …
… The Tesla Semi …
… And the Model 3 …
… And Model Y for the eastern half of the US.
Tesla’s newest factory is in Shanghai. Unlike most other foreign automakers, Tesla owns this plant; since the 1990s, other automakers have entered into joint ventures with Chinese companies.
Tesla has been building the Model 3 in Shanghai and is preparing to ramp up Model Y production; last week, the company showcased some of the multimillion-dollar industrial robots it has installed.
The first Model 3s have been rolling off the assembly lines already.
In 2021, according to Tesla, the Model Y will join the Model 3 at the Shanghai plant.
Tesla Motors/Handout via Reuters
Tesla is also constructing yet another Gigafactory near Berlin.
Photo by Paul Zinken/picture alliance via Getty Images
That plant should commence Model 3 and Model Y assembly in 2021.
Matt Debord/Business Insider
The bottom line here is that Tesla has gone from a one-factory automaker building just one car in 2012 to a global force with a growing manufacturing footprint in 2020.
Flickr/ Maurizio Pesce
So what does that mean? Beyond Tesla becoming the world’s largest manufacturer of electric vehicles — and establishing a near-monopoly in that admittedly still-small market — it indicates that Tesla is making good on its promise to be a sustainable mobility and energy company.
All these factories should enable Tesla to create significant industrial scale for EVs, batteries, and solar products. Over time, that should lead to economies of scale, as well, and empower the company to vindicate its very elevated market capitalization, now some $300 billion. (That’s more than GM, Ford, and Fiat Chrysler Automobiles combined —and more than Toyota, making Tesla the world’s most financially valuable automaker.)
Bear in mind that this much manufacturing expansion also means debt and spending, at 2020 prices. By contrast, Ford is still operating factories that were bought and paid for before World War II.
But also bear in mind that Tesla intends to pursue more aggressive automation of these new factories, so it could make them pay for themselves much faster than carmakers have with older plants.
What’s clear is that Tesla’s master plan has begun to occupy some serious worldwide real estate. It’s impossible to avoid how impressive this development is — and how much of a contribution it could make to Tesla’s future.
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