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Tesla’s German Operations May Shift to Texas Gigafactory

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Tesla signage on building | Image by Shutterstock

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In a move that could benefit Texas, Tesla is reportedly halting certain activities at its production facility in Berlin and shifting them to the Gigafactory in Austin, according to a new report published in the German newspaper Handelsblatt.

In recent months, it has been rumored that the EV manufacturer is planning to shift battery production to Texas to lessen supply chain challenges, like delays and bottlenecks. In fact, after struggling with battery production in Germany, Tesla has reportedly already begun moving equipment to their Austin plant.

Both the Berlin and Texas locations are massive production facilities. Gigafactory Texas is one of the largest buildings in the world, and at the end of June, Tesla filed a permit application to add a new 500,000-square-foot building. The plant is already equivalent to 15 city blocks, or three times the size of the Pentagon, according to Elon Musk.

Musk also noted both facilities are not just gigantic in size; they are “gigantic money furnaces.”

In the past, Tesla has indicated that it intends to produce its new 4680 battery in Austin, though little progress has been shared publicly. At this point, experts are not even sure which vehicle models would utilize the new 4680 battery.

What is clear is that Tesla is currently in the process of making small batches of these new batteries. The company is piloting the new cells in its factory in Freemont, California, and there are plans to ultimately produce them at scale at the Austin Gigafactory.

While details are scarce, drone footage of the Austin plant while under construction revealed equipment designed for battery production was present on the site.

Initial rumors suggested Tesla’s transition to Texas was to take advantage of new, favorable U.S. federal EV tax credits. While this might be true, the report from Handelsblatt does not confirm this to be the case. Instead, the German newspaper notes that Tesla aims to perfect its new dry-coat electrode process domestically before proceeding with production elsewhere.

Whatever the reason, it is looking increasingly likely that Texas will be the beneficiary of expanded Tesla production in the near future.

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