Tesla has faced all sorts of issues and setbacks in Germany related to building an EV factory near Berlin, and now it seems government subsidies for Giga Berlin have reportedly yet to be approved. This is all while Germany's state and federal governments are known to pay up to 45% of some factories' costs.
The information about Tesla's lack of government support in Germany was published by Teslarati based on recent reports from local publications. Tesla is already producing Model Y crossovers at the factory and has been for nearly a year. The ramp-up process is well underway, and, according to Brandenburg Economic Minister Jorg Steinbach, some 9,000 employees are working at the factory.
More than two years ago, in November 2020, Tesla submitted official paperwork to take advantage of funding for its new EV factory in Germany. However, Brandenburg’s Ministry of Economic Affairs has noted that the US EV maker is still yet to receive "a single cent of funding." The statement reads:
“Tesla has not received a single cent of funding so far. A state aid notification procedure is currently underway in Brussels for Tesla’s application."
German media outlet BZ recently reported on the matter, noting that companies typically get incentives and support from the German government when they open new factories. In fact, the publication shared that, at times in the past, state and federal governments in the country have worked together to pay as much as 45% of the cost of the factories.
Reportedly, the EU Commission will eventually have to make the final decision regarding whether Tesla's Giga Berlin will receive any government funding. Once the determination is made, decisions will also need to be made about the total amount Tesla should receive.
Why the delay or lack of government support, in general?
BZ says Tesla simply moves forward too quickly for Germany's liking. We've reported on a number of occasions that the processes surrounding Giga Berlin have been very slow and painstaking compared to Tesla's experience with factories and related paperwork and approvals in the US and China.
Tesla works at a ridiculously fast pace and makes major changes on the fly. If it sees that something isn't going as planned or could be carried out more quickly, efficiently, and perhaps in a more affordable manner, it may move in a whole new direction. This type of work doesn't fit with Germany's careful, cautious, thorough, and meticulously planned-out manner of operation.
The report states that Tesla's original paperwork requested 1.1 billion euros of support, but the number has changed often, meaning the paperwork has had to be submitted multiple times. When Tesla realizes it needs to revamp its efforts, it makes changes, and then the original paperwork becomes void.
The Ministry has clarified that Tesla's application for funding from Germany is a process that continues to evolve. Thus far, based on the current details, Tesla could eventually get 6.8% government funding toward Giga Berlin. Teslarati notes that if the project costs some 2 billion euros, Tesla could expect over $130 million in support from Germany.