Germany: Tesla Giga Berlin Construction Interrupted Again

The company is required to make a security deposit of €100 million ($123 million).

Tesla Giga Berlin (Tesla Gigafactory 4)

Mark Kane

By: Mark Kane

Dec 18, 2020 at 9:31am ET

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According to the German media (Tagesspiegel), the Brandenburg's State Environment Agency has required Tesla to stop the installation of the manufacturing equipment in the paint shop and clearing the tree farm at the Tesla Giga Berlin until it makes a security deposit of €100 million ($123 million).

It seems that the project constantly moves forward and back. Just recently, the company received permission to clear an additional part of the tree farm, then it was blocked, and now it's not allowed altogether with the installation of the paint shop.

The article explains that as Tesla has only conditional approval for the construction, it must make a security deposit for any dismantling costs - in case the project gets rejected in the end. Remember: Tesla is building the factory at its own financial risk, without the final permission, and will be required to turn the entire site into a tree farm again, if it does not receive the final permit.

The deadline for the deposit was December 17. Tesla applied on December 16 to extend it to January 15, but it was extended only to January 4, 2021.

"As long as the money is not there, the two partial permits are suspended. This change happens in the middle of the ongoing proceedings before the Higher Administrative Court of Berlin-Brandenburg (OVG) for the clearance of 82.2 hectares planned by Tesla, against which the Nature Protection Association and the Green League are suing."

It's not clear why Tesla, one of the highest valued companies globally now, was not able to pay the €100 million deposit. The official reason is that the company needs more time, because it requires internal coordination and processes that could not be completed within the days since the notification of the early approvals.

Well, finding the cash, waiting for the court or the "new season" to clear the tree farm, and who knows what else, is a sign that it's not easy to build a factory in Germany. Tesla's CEO Elon Musk probably is already done with California, it will be interesting to hear what he now thinks about Germany.

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