The 2022 Tesla Gigafactory Update is Here!

 2022 is already shaping up to be the year of the GigaFactory over at Tesla; with two new vehicle production plants opening on two continents at more or less the same time. The company finally gets to show the world what they’re capable of now that the art of manufacturing EVs has been perfected. The last two years were just a warm up, and there is much more to come. Berlin and Austin are not the end of the GigaFactory story, because Tesla is already dropping news that the next factory location is being scoped out right now, and we’ll probably learn by the end of this year just where the company plans to go next. Where might that be? We'll get there. But first let’s run through everything we know about Austin and Berlin as they get ready for business.

Where It Started

This is probably a good opportunity to take a quick look back at where the Tesla vehicle factory concept started out, and how far they’ve come in just a few years. 

So, Tesla’s first bespoke electric car factory was Giga Shanghai - that construction project started in December 2018. This was just over a year after the very first customer delivery of a Tesla Model 3, they’re first mass market vehicle. That made 2018 a very big year for Tesla, it marked their first ever giant leap in product deliveries, going from 13,000 cars in 2017 to 245,000 cars in 2018. All signs pointed to the need for the company to expand. They had been working exclusively out of the Fremont California plant which was built in the 1970’s for use by General Motors, then refurbished to make Toyotas in the 90's, and then abandoned completely before Elon Musk was able to buy it for cheap. So it was a good deal at the time, but it wasn’t the ideal location to be building the car of the future in the factory of the past.

Giga Shanghai was constructed at a breakneck pace - taking less than one year between site grading and first Model 3 production. It was also built incredibly cheap - that’s not to say cheap as in poor quality, just cheap as in affordable. The Model 3 production line in China was built for approximately 65 percent less capital expenditure per unit of manufacturing capacity than the Model 3 line in California. There’s a reason everything is made in China these days. And to give you an idea of how far this plant has come in two years - they started the year 2020 with a production rate of just 1,000 vehicles per week, and they ended 2021 with an estimated annual rate of 700,000 cars per year.

Anyway, all that to say that the Tesla of 2019 that opened their first vehicle factory in China while selling 367,000 cars in a year, is a much different company than the Tesla of 2022 opening their next two factories after selling 936,000 cars in a year.

Giga Austin

Giga Austin is a very big deal right now. From the most recent drone flyover videos we can see that the place is looking pretty much finished. As of right now, the solar panel array is being installed on the roof of the factory - from what we can see already, it looks like the word Tesla is going to be spelled out in the space between the panels, so that should look pretty cool. But more than anything it’s great to see all of the solar panels being installed early and so quickly, remember Giga Nevada, that was supposed to have a nearly seamless, wall to wall solar array on top  - and even though the building turned out to be just a fraction of its original planned size, they’ve still hardly covered anything with panels even years later. So that’s pretty cool.

Speaking of rooftop views, shoutout to Joe Tegtmeyer for posting all of these drone videos on Youtube for us - I just learned that Joe drives almost 400 miles round trip to the factory to shoot these videos and he does that three times a week, so mad respect for that commitment. This man is a beast.

Anyway, an even bigger win for Texas is the 15 thousand jobs that will be created either directly or indirectly by the Tesla factory. As of October 2021 5,000 people had already been hired by Tesla to work in Austin.

We’ve also just learned that A 500 million dollar, 2,500 house development project will come to the City of Austin located near Tesla’s Gigafactory as the plant is catalyzing employment in the area and bringing on a need for more housing.

I can’t imagine any city that isn’t jealous looking at those numbers, a huge number of good paying jobs and more housing supply, that’s a beautiful thing.

We know from Tesla's Q4 2021 earnings call that the Model Y vehicle is being built inside Giga Austin right now and has been for a little while now, probably beginning as early as December. We also know that Tesla expects customer deliveries of those vehicles to begin in the first quarter of 2022 - that means before the end of March. And we also know that the Model Y being built right now behind those walls is the next generation Tesla vehicle with 4680 battery cells in a structural battery pack and fully die-cast front and rear sections.

Going even further into the future, Elon Musk has said that even though production of the Tesla Cybertruck will not be happening in 2022, he said that tooling and manufacturing equipment for the eventual Cybertruck building will be brought in and set up and tested throughout this year. So that’s also pretty cool.

And lastly, our bold prediction for Giga Texas in 2022 is production of the Tesla Semi. We’ve already seen that a few of these trucks have been built at the Giga Nevada site - so we know that the production equipment and tooling for Semi is up and running - but it’s all being done at a factory that was never meant to build vehicles in the first place, Nevada is a battery factory. So the only thing that would make logistical sense for Tesla to do, is move production of the Semi over to Texas. The Tesla Semi really did not get talked about on that recent earnings call, all the attention went to Cybertruck and the rumored but definitely not being worked on, 25K vehicle. So, maybe they're saving one cool surprise for this year?

Giga Berlin

The GigaFactory in Berlin - or near Berlin we really should say - I think it’s technically located in ​​Gruenheide - but that adds a lot of complication to the matter. Anyway, this factory actually started construction before Giga Austin; the first ground clearing began in February 2020 in Germany and everything was looking so good. This would be an amazing factory, building cars and batteries and flooding the European market with brand new Teslas by summer 2021.

There were some complications along the road, which we’ve already documented heavily and won’t go deep into today. And luckily the reason that we can gloss over the whole series of objections and delays is that it all has finally come to an end. As far as anyone can tell, including even the German government officials, the Berlin GigaFactory will be delivering cars by March 2022 - same schedule as giga Austin. The only thing we are waiting on is the official final approval from the government now that Tesla has submitted the entire mountain of paperwork that was required just to get this factory going. They made pretty amazing progress, all things considered - like when you find out that it took Berlin like 30 years just to build an airport.

And we already got a really good look inside the factory way back in September of 2021, which looked amazing then and probably looks even better now. Plus the exterior of the factory is currently being covered in gigantic murals that stretch from the ground to the roof and have a really cool kind of street art, graffiti style to them.

So, good news for the most part. There are still a couple of downsides to the first production run in Berlin - they will be building the Model Y, but unlike in Texas, these German cars will not have 4680 batteries or structural battery packs, so that’s not the end of the world, but it’s kind of a shame that the latest and greatest factory won’t be building the latest and greatest vehicle design. The 4680 cells will eventually be produced on site at Giga Berlin, there is a dedicated battery cell manufacturing plant under construction right now, but that’s not happening any time soon.

Where to Next?

One last interesting point to bring up - During that Q4 earnings call, Elon and the Tesla bigwigs said that they are already in the process of selecting the location for the next GigaFactory, it didn’t sound like they had a final decision yet, but they did sound pretty confident that an official announcement would be made before the end of this year about the new location.

So that gives us the opportunity to speculate a little bit. Where will that next factory be located?

Well, India has been a front runner for a while now; I think it was a year ago we made a video all about the anticipation around Giga India. And it makes a lot of sense for a lot of reasons. One, India is home to an insane talent pool of engineers, and coders, and developers, and just generally really smart people who are leading the world in high tech applications. We could see from the presentation at Tesla AI day that several people have come from India to America to work for Tesla; maybe Tesla would be willing to take the next step and go to them. Next up is the location, we’re pretty sure that if Tesla were to build their factory here it would be in the region of Bengaluru, which is right in the middle of the country’s Southern peninsula. That means easy access by cargo ship to the Middle East, Africa, South East Asia and Australia. It’s a very prime location in that half of the world.

Then there is this ongoing negotiation between Tesla and the Indian government. There’s been a lot of talk about India showing Tesla some love in the form of tax breaks. The Indian government does not like the import of foreign made electric vehicles and their tax levies can be as high as 100 percent of the cost of the vehicle. So, obviously Tesla can’t make any money under those circumstances. They’ve been trying to get the Indians to change their minds, but zero progress has been made. On February 1st, India released their annual national budget that included a bunch of good news for domestic production of electric vehicles, but no new considerations for Tesla. So, to me, this seems like some very hard ball negotiations taking place. India is saying they want to support electric vehicles, but only the ones that are made in India, everyone else has to pay through the nose if they want a piece of the Indian market. So, if Tesla were built in India, then all of those problems would disappear and all of the benefits would materialize.

Or maybe Tesla will build a factory in the United Kingdom. Since the UK is no longer a part of the European Union, there are some extra complications that come from trying to get cars made in Germany into the British and Scottish market. Maybe Tesla would work around this by opening a smaller factory in England that would serve the local market.

There were even rumours last fall going around about a Tesla factory in Russia in the city of Korolyov near Moscow. I can’t see any practical reason that Tesla would want to have a factory here - there is nothing at all to the East or South of Moscow except wilderness and a scattering of tiny villages - there are probably more bears and tigers than people in that area of Russia. And all of the countries to the West and North of Moscow could be easily served by Giga Berlin. Elon Musk did step into kind of quash the rumours on Giga Russia, except he didn’t really say specifically, so I guess it still leaves the possibility. In response to a tweet about Giga Russia coming, Elon wrote “Tesla has not yet decided on a fourth Gigafactory location.” So, he didn’t say no.