Bloomberg Goes Inside Tesla Gigafactory


Tesla Gigafactory

Bloomberg Reports That The Massive Tesla Gigafactory Seems Dwarfed By The Nevada Landscape (via OxBlue time lapse construction photography)

Tesla’s Gigfactory is beginning to get more recent press, and visits are becoming more regular. Bloomberg was the most recent on the visitor’s list.

A Glance Inside The Tesla Gigafactory

A Glance Inside The Tesla Gigafactory

The report explained the lobby decorations as “classic Tesla”:

“Large windows, high ceilings, gleaming white floors, black leather chairs. One of the Powerwall home batteries made at the factory hangs like a piece of modern art. Guests receive hard hats, reflective vests, and safety glasses along with the complimentary bottled water and coffee.”

Conference rooms are named after elements on the periodic table. Specifically, elements that are primary in battery making such as lithium, cobalt, silicon, nickel, and aluminum.

Every aspect of the company’s battery production, from start to finish, will happen at the Gigafactory. Tesla joined up with Panasonic to make this happen. The company’s new goal is to produce a half million vehicles per year by 2018. The biggest factor in making this a reality is batteries.

While the factory is only 14 percent complete, and will not be done for about 4 years, work is constantly underway. Ninety percent of the current space is still undergoing construction, and in the meantime, the usable spaces are already in production mode.

The reported size of the Gigafactory has been consistent at 5.8 million square feet. However, Bloomberg made it more clear that some sections will have as many as four stories, so the usable space may be more. The entire roof will be covered with solar panels.

Tesla co-founder J.B. Straubel assured investors that the company has plans laid out for much multitasking. He confirmed:

“We won’t need to rob from Tesla Energy plans in order to meet the Model 3 schedule. We definitely have a way to solve both.”

Do check out the full Bloomberg report with lots of new/great pictures of the Gigafactory here.

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56 Comments on "Bloomberg Goes Inside Tesla Gigafactory"

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Remember everyone who said “It will never be built”

Where did they go?

They’re now saying the Model ≡ will never be built. Repeat ad nauseum.

I am a MS owner and stock owner as well, but I am wary that Tesla will meet these newer HUGE production numbers and provide the same quality (in terms of fit and finish) as other ~40k cars. This is still a problem with the MS, but getting much much better, and listening to other Model X owners is still a big problem. But man I sure hope they do to shutup the naysayers.

This is hilarious. The Tesla bashers have flipped from constantly claiming Tesla was faking its production numbers and was about to go bankrupt… to now claiming that Tesla will never be able to make enough cars to satisfy demand!

😀 😀 😀

Every company should have such “problems”. It’s known as “Crying all the way to the bank.”

Here’s how ridiculous and how desperate the bashers’ whinging has gotten: tftf was posting to InsideEVs just a day or two ago, claiming that it was impossible to build perfectly ordinary concrete floor, walls, and ceiling for the Gigafactory fast enough for Tesla to ramp up production inside.

Now, I do question that Tesla can persuade Panasonic to ramp up battery cell production as fast as they want. Building mass production lines and fine-tuning them does take time, and that’s why it’s generally said that building a high volume factory and ramping up its production generally takes two years.

But just building the shell of the building like this, one that’s not especially high and made of perfectly ordinary building materials, can be accomplished quite quickly if needed.

Reports are that Panasonic invested more in the plant during this last quarter, than it did since the beginning of the project…

“tftf was posting to InsideEVs just a day or two ago, claiming that it was impossible to build perfectly ordinary concrete floor, walls, and ceiling for the Gigafactory fast enough for Tesla to ramp up production inside.”

Would you please quote me correctly?

I wrote that the groundwork and shell structure alone with take about A YEAR ALONE – then Panasonic has to build out the interior.

So we are in mid-2017 even if they start tomorrow (and there’s no indication on the ground so far…).

So far, Panasonic and Tesla (up to Q2 2016) only invested $508 million.

That’s of course only 10% of the 5 billion once projected to be invested until 2020.

Now they want to achieve this by around 2018.

We will see.

tftf objected to my post:

“Would you please quote me correctly?”

“I wrote that the groundwork and shell structure alone with take about A YEAR ALONE…”

All animosity aside, tftf, I see no logical difference between what you said and my paraphrase of that.

I countered that with multiple construction teams working on different sections simultaneously, it could be done in six weeks, not including the possibly extended time which might be required for a large concrete pad to cure. I see no reason to alter that assertion.

Your claim of “a year” is nothing but pure, 100% FUD. Go peddle your papers elsewhere.

I don’t remember that “everybody” and frankly I was hoping it will be really built. Now we have 14% real estate and construction inside, and no capital left, it is gone poof. You may hope new shareholders will bring extra 5-10 billions and it will be enough to actually build this factory and get tooling for 0.5 mln car/year production at least in 2020, but you can’t know really.

I am confident in Tesla Motors insofar as they could make their original target of 500k vehicles in 2020. But my tolerance is starting to peak now that Musk wants to halve the timeframe with the top two manufacturing execs walking off (or fired, whatever).

I’m cool with guts and risk-taking, but this is getting ridiculous. I want my Model 3, not a refund.

What? They already spent over $500 million. Tesla only needs to spend something like $50 to $100 million for the pilot phase and Panasonic has committed $1.6 billion, of which they have spent $128 million. Tesla already has the money in hand to get the first phase online.

To launch the Model 3, they need that first phase. To achieve the hopeful 2017 production numbers, they need two phases online. Again, not an insurmountable amount of capital.

Ummmm…. They got like almost 4 billion from the Model 3 launch.

400m, not 4b.

Probably even more as you have to pay a lot more than the US reservations price of USD 1000 in many countries: Denmark: DKK 10000 = USD 1528 Great Britain: GBP 1000 = USD 1443 Japan: YEN 150000 = USD 1372 Hong Kong & Macau: HDK 10000 = USD 1288 Sweden: SEK 10000 = USD 1225 Norway: NOK 10000 = USD 1219 Eurozone & Russia: EUR 1000 = USD 1137 Mexico: MXN 20000 = USD 1111 Australia: AUD 1500 = USD 1106 Liechtenstein & Switzerland: CHF 1000 = USD 1025 Canada: CAD 1000 = USD 774 Brazil, India, New Zealand, Singapore, South Africa, South Korea, Taiwan, United Arab Emirates & USA: USD 1000 Model 3 Reservation Deposit:

Can the Gigafactory supply batteries for 500k cars when it’s not fully built?

Most likely not, it will be interesting to see how they handle that. The production short fall from not having the factory finished will have to come from a Panasonic facility I would guess

That’s definitely possible but I would guess that the cells coming from Panasonic and not from the Gigafactory would be more expensive, so they would likely be used for model S and X. It will be interesting to see just how much batteries Tesla can make in 2018

Tesla may well continue to use batteries from Panasonic’s other battery factories for the Model S and Model X, but it makes no sense at all for them to use them in the Model ≡.

The Model ≡ is priced at a point that requires the cheaper Gigafactory cells for Tesla to make its targeted gross profit percentage on the car, and the Model ≡ battery pack is designed to use those larger GF cells… not the 18650 cells currently in use in the Model S and X.

Now, I’m not saying it’s impossible. What I’m saying is that if Tesla does that, it will be counterproductive and will cut significantly into their profit margin for the Model ≡, which at a targeted 15% is already thinner than the approx. 25% profit margin on the Model S. So why would Tesla do that?

I don’t see how they meet their production targets otherwise. If the factory being finished is necessary for them to hit the volume they are shooting for, which they have claimed, then I don’t see how they can hit their production targets for 2018 when the factory won’t be finished until 2020.

(a) Obviously the accelerated schedule for getting the Model ≡ into production and ramping up that production to high volume, requires a simultaneous acceleration of the build-out of the Gigafactory.

(b) I don’t regard Tesla’s (or maybe just Elon’s) stated goal of 500k cars produced in 2018 to be realistic. I’m sure Tesla will attempt to ramp things up as fast as is practical, but I don’t think 500k cars in a year that starts in only 1-1/2 years, is achievable by Tesla Motors. That would be ten times as many cars as they made last year! I regard this as more hype from hypemeister Elon Musk.

Panasonic will still be providing cells for 100+k vehicles at that point in time.

The Gigafactory is bigger than before and the Model 3 requires less cells than initially estimated. Probably 3/5ths of the Gigafactory needs to be online by fall of 2018 to hit the production estimate. 1/5th is coming online this year, another 1/5th next year, and another 1/5 the year after.

Good point on the possible smaller then expected battery size of the model 3 that could be very important for Tesla in reaching 500k cars sold in 2018. I’m kinda not expecting them to reach that number but at least get to about 300-400k which would still be great and move the whole industry sooner to a plug-in future

Probably 3/5ths of the Gigafactory needs to be online by fall of 2018 to hit the production estimate. 1/5th is coming online this year, another 1/5th next year, and another 1/5 the year after.

That was the original schedule, with full production not slated to occur until 2020. If Tesla is serious about making 500,000 cars in 2018, they’re gonna have to build out sections of the Gigafactory and get them into production faster than that.

Nope. That;s for the pulled forward numbers. One phase online this winter… Producing about 130,000 Model 3 packs in 2017. 2nd phase online sometime in 2017 if by mid-2017, can add 60,000 for 2017 to being production to 190,000 for 2017. Those two are fully operational in 2018 producing 260,000 packs. 3rd phase coming online in spring, 2018 would provide another 90,000. That’s then 350,000 for 2018, then 150,000 from Pansonic’s existing Japanese factories for S+X, we get 500,000. 3 phases is all that is needed to hit the revised 2018 numbers.

Well, I admit I can’t figure out why you’re saying this. The original plan was for the Gigafactory to be fully producing in 2020, with Tesla producing 500k cars that year, or at least to be at a production rate by the end of 2020 equal to 500k cars per year.

But if they’re gonna try to hit 500k cars in 2018, a full two years ahead of schedule, then obviously the Gigafactory will have to be producing at full capacity by then.

That’s simple logic. Perhaps you are correctly citing what has been said elsewhere, but I don’t see any room for any interpretation of the facts other than what I’ve said here.

I don’t buy that the Model ≡ will need fewer batteries than anticipated. Fewer than some outside observers estimated, yes. But Tesla already had a pretty good estimate of how big a battery pack they intended to put into the Model ≡, and their plans for the Gigafactory were based on that number.

An option is to start with suppliers that produce precursor materials, so the Gigafactory only does the assembly of the battery cells.

Later on, when the gigafactory expands, they move that in house and process the raw materials directly.

That might help ramp up Gigafactory production, yes. But the GF will have to actually produce all the battery cells that are going to go into all the Model ≡’s, so far as I know. And as I’ve said, it makes no financial sense for Tesla to do otherwise.

If there is a bottleneck in processing from precursor materials to finished, ready-to-assemble materials, then yes this can speed things up. But it won’t help at all with any bottleneck in cell assembly, or with assembling the packs.

Furthermore, having the pre-assembly work done offsite negates the claimed advantage of vertical integration, which again would cut into Tesla’s profit margin… so again, why would Tesla do that?

Now, there may be a practical reason; perhaps they plan to grab a larger market share, with the tradeoff of essentially making no profit on the Model ≡ for the first couple of years. Mind you, I’m not suggesting this is so; I’m just pointing out that, logically, this may be a possibility.

Don’t worry John, tftf or Spiegel or some other stock manipulator will probably visit soon to whine how it can’t be done.

It will obviously be done as quickly as possible in a modular fashion, one segment at a time.

A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”
Winston Churchill

Don’t worry. Everything is fine at Tesla and Solarcity.

All Musk has to do is install a second sleeping bag at Solarcity…

I called it!

He forgot SpaceX… And they just pulled a 5G, three engine landing of a first stage on a barge, from orbit, in the dead of night. While also delivering a payload into orbit, for a paying client.

Many thought that was impossible (or insane), not long ago, too.

Wait for the Falcon Heavy, with THREE first stages returning, and the powered landing of the Crew Rated Dragon at 39A.

No need to repeat what I have written here…

See comment section. The “full” GF lacks billions:

Sfar Tesla and Panasonic only invsted $508 million, about 10% of the total investment.

The new 2017-2018 Model3 ramp is beyond optimistic in terms of cars and batteries.

We will see. Reality is only 24 months away…

PS: SCTY could be in trouble well before then if credit markets turn sour. Stock is almost back to IPO levels. All these companies are connected with credit…

More cowflop from your unfriendly neighborhood serial Tesla basher.

There are plenty of sources for solar panels. If SolarCity goes belly-up, that won’t affect the pace of Gigafactory construction in the slightest.

Tesla Motors has demonstrated an astounding level of demand for the Model ≡, with nearly 400,000 people putting down $1000 “earnest money” apiece. With that as solid proof, Tesla will have no problem borrowing the billions it needs to complete Gigafactory construction and tool up to produce the Model ≡.

Now, I wouldn’t be at all surprised to see Tesla offer a new round of stocks to investors. But most of the capital will be obtained by borrowing, not sales of new stock.

Even a non-investor like me knows that much, so as usual, the desperate FUD and propaganda from serial Tesla bashers seems aimed only at those who are either far less informed than any investor ought to be, or readers lacking even average intelligence.

“most of the capital will be obtained by borrowing, not sales of new stock.”

Aha. If it were that easy.

Tell me how when they already have their assets in an ABL at up to $1 billion in Feb 2016 and SP rated their existing bonds junk…the rates would be really high.

The easiest way is issuing more stock, but even that is limited as investors don’t believe in Elon’s wild promises (see stock price since Model3 announcement and last Q report).

tftf, this is the exact same FUD B.S. you’ve been repeating for years now over on Seeking Alpha. And it’s even less true today than it has been in the past. With ~400,000 people putting down $1000 apiece on a Model ≡, Tesla should find it even easier to borrow money at lower interest rates than they have in the past. The reality has changed… unlike your FUD.

“‘When the facts change, I change my mind,’ John Maynard Keynes once observed in a debate. ‘What do you do, sir?’ Why, sir, they take no notice of changed facts and so are untroubled by such questions.” — Rex Murphy

Read the latest 10-Q, that could help:

The ABL is cranked up to 11 already.

And the SCTY link is not about getting solar panels, but the financial connections and leverage (aka house of cards if things go wrong) between Solarcity, Tesla and Space X – including Musk himself.

Read the WSJ link and see the attached graphs in that article.

Well, personally, I was accepting their 2020 goals, but now that they moved those goals up to 2018, while their top two manufacturing execs just walked off (or were fired, whatever)…

…the fundamentals of product demand are on Tesla’s side, obviously…but who is going to step in and do it on Musk’s timeframe? Has he finally bitten off more than he can chew? Who is going to buy the stock? I doubt it – at over $200/share, it’s too rich for me. I already gave them a $1k interest-free loan.

Or is the Model 3 design much farther along than we assume? If the drivetrain in the prototypes is already production-ready, and if 80%+ of the remaining design features are locked, then maybe it’s possible?

As a reservation holder, I would be fine with the original 2020 goals. If moving the goalpost to 2018 breaks the back of their stock, then I’m going to be left holding a refund, and that’s not what I signed up for. I want my car, damnit, not theatrics.

Elon says all Model 3 design work to be completed by June 30th. There aren’t supposed to be too many outstanding issues left on the design, to prevent that from happening.

We know the Trunk and the Dashboard / Steering wheel were issues with many folks. Not sure when we’ll see a working mockup of these. Possibly early July for the second reveal? I don’t think they can drag that out too long, considering the accelerated timetables they’re quoting for starting production. *shrugs*

I’m marrying Gigafactory 1, cause she’s got such HUGE…..tracts of land!

I think the Gigafactory 1 is a he.

Damn him…uh her….them!

Remember, some day you have to pay property taxes on that land

…but not for something like 10 or 15 years, per Tesla’s deal with the State of Nevada.

I don’t see anything new in this report. This is just a re hash.

I want more specifics about exactly what Li batt machinery is being put in place. If they miss their schedule there will be hell to pay.

What hell? Did Tesla Motors get hell for being two years (or more) late with the Model S and the Model X? Nope. Some complaints, yes, but no actual consequences.

Looks like more of the same to me. Musk keeps setting unrealistic goals for getting the cars into production. This one seems even more unrealistic than previous ones.

Yeah, I realize that some people will get frustrated and cancel their reservation. That was gonna happen anyway. As I recall, at one point it was said that about 25% of Model S reservations were cancelled as time went along. I dunno if cancellations for the Model ≡ will be more or less than that. But for Tesla Motors’ bottom line, it doesn’t really matter so long as there are more people who want to buy Tesla cars than Tesla can make.

I love Tesla’s actual accomplishments, but I hate the hype. Claiming that Tesla will actually produce 500,000 cars in 2018 looks very much like hype to me, and Tesla’s history doesn’t support the claim either.

Of course, I hope to be proven wrong here, but I doubt that’s gonna happen.

“Claiming that Tesla will actually produce 500,000 cars in 2018 looks very much like hype to me”

That’s not how I understand it. The targets is that they reach a production rate of 500k/year in 2018. So if they produce 10,000 cars in the last week of 2018, and maintain that level thereafter, then that is goal achieved.

You are correct, it’s a 500k run rate (10k/week) by the end of 2018. That’s extraordinarily aggressive but not a total fantasy.

Musk’s off-the-cuff estimate of 100-200k Model 3 units built during the second half of 2017, however, is another story. It’s total BS — a good example of the Musk reality distortion field in action.

@arne-nl and Doggydogworld:

Thanks for the input, and correction, guys.

So, I should have written:

Claiming that Tesla will actually produce 100,000 or more Model ≡’s in 2017, and achieve a production rate (including the Models S and X) by the end of 2018 equivalent to 500k cars annually, looks very much like hype to me, and Tesla’s history doesn’t support the claim either.

In JB Straubel and Elon Musk we trust.

apparently, most of us just handed him 1000$!

A good idea for the future Mars Dollar bills!

After the giga factory are they gonna make a bigga factory?

A Terafactory for supplying electric batteries for electric 777 and a Marsfactory for supplying the electric Mars rovers and hab powerwalls.

I hope everyone looks at the article at Bloomberg. Those are the most magnificent Gigafactory pictures I’ve ever seen! You can tell they were done by a true artist of a photographer, unlike (for example) local coverage by the Reno Gazette-Journal.

Here’s that link again:

On the factory scale model picture, on the right, there is something that looks like a landing strip. That’s cool.

“…Conference rooms are named after elements on the periodic table…”

I wish I could be there the first time someone says “I’ll be in the Porcelain Room…”

Yes, I know Porcelain isn’t an element, that’s what makes it funnier.