Tesla scouting for sites for Gigafactory in central USA

Tesla is looking for a site to break ground for a factory to build its Cybertruck, announced CEO Elon Musk on twitter. They are looking at central USA to build the factory said Elon Musk in the tweet. Musk followed up this revelation with another tweet about their search for a location for its Model Y production, which would be on the East Coast.

It is reported that Tesla is in talks with Nashville officials to find a suitable site for its plans to build a gigafactory for its all-electric Cybetruck.

In an email missive to the Wall Street Journal about his search Elon Musk wrote:

Incentives play a role, but so do logistics costs, access to a large workforce with a wide range of talents, and quality of life.

Tennessee is a popular destination for electric vehicle productions. It houses Volkswagen’s factory in Chattanooga, which the company is planning to expand with an infusion of $800 million. Volkswagen plans to make it the company’s North American base for manufacturing electric vehicles. The factory will start EV production in 2022. Nissan already manufactures its model Nissan Leaf at its factory in Smyrna, Tennessee.

tesla gigafactory

Tesla has been expanding its production capacity in recent years. It has opened a gigafactory in Shanghai and brought out the Model 3 and the crossover SUV Model Y last year. Its capital expenditure of $1.33 billion in 2019 was mainly towards building the new factory and the production of the new models.

It is not clear what production capacity Tesla is looking for its fully electric Cybertruck or its Model Y in its gigafactory plans.

In its fourth-quarter earnings call in February, Musk was bullish about the sales of both his Cybertruck and the lower end SUV Model Y. He said that the demand for Cybertruck was high and he was confident of selling to capacity of that truck.

“I have never seen actually such a level of demand as this — we’ve never seen anything like it basically,” Musk said. Musk also revealed during the call that he believes annual Model Y deliveries could eventually exceed a million units.

The electric car maker giant has a production unit in Fremont, California, where its annual production for 2019 was a combined 90,000 for the Models S and Model X, and 40, 00 units for Models 3 and Y. The factory earlier housed GM and Toyota’s New United Motor Manufacturing Incorporation

The Shanghai Factory, the company’s newest production unit, has an annual capacity of manufacturing 150,000 Model 3 vehicles.

Tesla plans to expand the production capacity of its Fremont factory to accommodate the delivery of Model Y units which are planned this month. The intention is to increase the capacity to 500,00 units with the addition of new machinery, according to its fourth-quarter declarations.

The annual delivery expectation for 2020 is to exceed 500,000 units, up from about 368,000 for 2019. The demand will be fuelled by the deliveries of Model Y and Model 3.

Tesla doesn’t plan to start producing its Cybertruck until late 2021.

Tesla has two more gigafactories in Reno, Nevada, and in Buffalo, New York. The Reno factory is 1.9 million square feet and makes battery packs and electric motors for its Model 3 vehicles. It makes lithium cells in collaboration with Panasonic here. In Buffalo, it manufactures solar cells.

There is another factory planned in Berlin to meet the European demand for its Model 3 And Model Y cars.

Anna Domanska
Anna Domanska is an Industry Leaders Magazine author possessing wide-range of knowledge for Business News. She is an avid reader and writer of Business and CEO Magazines and a rigorous follower of Business Leaders.

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