Tesla Acquires 431,000 Square Foot Facility In Lathrop, California – Begins “Manufacturing Modifications” Of Site

APR 22 2014 BY ERIC LOVEDAY 48

Has Tesla Motors Outgrown Its Fremont, California Factory?

Has Tesla Motors Outgrown Its Fremont, California Factory?

Aerial View Of Tesla's Lathrop Facility

Aerial View Of Tesla’s Lathrop Facility

The city of Lathrop, California has confirmed that Tesla Motors has begun renovations on a 431,000 square foot facility that was once utilized by Daimler-Chrysler as a distribution center.

Tesla has been issued a permit by the city for “manufacturing modifications” on the Lathrop facility.  Reportedly, work is already underway on overhauling the existing facility to meet Tesla’s needs.

What are those needs?  CNC and Machining, of course.

As the Manteca Bulletin reports:

Information about the number of jobs that the facility would create and exactly which part of the manufacturing process – the company makes vehicles as well as electric vehicle powertrain components for other automotive companies – would be in Lathrop there was not immediately available through a communications agent for the company.

Tesla’s facility in Lathrop, California is located at 18260 Harlan Road.  Though listed at 431,000 square feet, the facility could apparently accommodate an expansion of 125,000 square feet, thus bringing the total size allowable on the 29-acre lot to 556,000 square feet.  That’s still far below the 10 million square feet Tesla says it will need for the battery giga factory, so this won’t become the site of cell production.

According to Manteca Bulletin:

“Daimler Chrysler’s Mopar distribution facility – which sent Chrysler, Dodge, Jeep and Ram and at that time Mercedes Benz components to warehouses, parts distributors and auto dealerships around the West Coast – was one of the anchor components of the Crossroads Commerce Center. The building has sat vacant since 2009 when Chrysler combined its small parts distribution in Los Angeles and Portland.”

“Chrysler’s Mopar parts division originally planned on 225 people for the Lathrop facility when it opened in 2001. That’s because the plan at the time was to merge Chrysler with Mercedes Benz. But when that union went south, the distribution center that is large enough to accommodate nine football fields became surplus capacity. Chrysler never utilized more than 50 percent of the space. There were 45 employees at Lathrop when the distribution center closed in 2009.”

As for Tesla’s use of the site, it will be almost solely a CNC/Machining facility.  Here’s a look at all of the Tesla job listings for the site:

Tesla Job Listing For Lathrop

Tesla Job Listing For Lathrop

Lothrop to Fremont Is Only 58 Miles

Lathrop to Fremont Is Only 52 Miles

Source: Manteca Bulletin

Categories: Tesla

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48 Comments on "Tesla Acquires 431,000 Square Foot Facility In Lathrop, California – Begins “Manufacturing Modifications” Of Site"

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Ah…the sounds of growth!

Excellent article. It addressed the 2 main questions I had before reading it.

1)why do they need more space and what will they do there and,

2) how far away is it from Fremont

I think this gives us an idea about what production rate Tesla has planned for the future 🙂

The map says 52 miles. I also thought there was a ton of space at the Fremont plant too.

I dunno, CNC is a pretty generic term in the manufacturing industry. You can make almost anything with jobs under that classification, so we really don’t know what they’re doing beyond making stuff.

CNC usually counts coordinate measuring machines too so it also could be “measuring stuff”.

Excellent point. So really, we don’t know jack about what Tesla is doing there.

Yes, since they tons of space in the Fremont facility. Probably just a reallwy good deal, maybe for the the Model E.

They took over a facility from Daimler, who had left it vacant for several years. As the companies are already partners, perhaps Tesla agreed to “take it off their hands”.

I guess they feel they don’t have to cram everything into one facility?

Perhaps this is for the new Titanium-armor and Aluminum extrusion additions to the undercarriage? But I wouldn’t see why they wouldn’t have room in Fremont for that work. Unless Fremont is being dedicated to vehicle assembly lines (including Model E’s), so Tesla needs space for manufacuring the parts.

I think that would make sense they might start moving some of the specialized part making processes out of the Fremont facility and move here. The reason why they would do it is to avoid having dozens if not hundreds of smaller assembly lines making small parts get in the way of the major car making lines. Also a lot of main steam car part makers don’t make EV parts so from day one Tesla has had to make their own parts in house.

Interesting to note they have also posted a giga-factory architect and giga-factory civil engineering job on LinkedIn.

Lots of plans moving forward….

Interesting. Tesla is only using 15%-20% of total space at their current Fremont factory, so makes me wonder what the new facility will be used for.

Actually, up to nearly 50% now, including areas being set up for MX and ME, R&D, etc.

Tesla has made remarkably few bad moves to date. (I won’t say none, as someone will then jump in here and mention something minor that I overlooked or didn’t know about.)

In particular, I think they’ve figured out that there are multiple benefits to building the gigafactory (which I’m assuming is not what the Fremont facility will be used for). Not only will it help them push down the price of batteries, but it will position them to be a battery supplier. If you look at our energy and environmental challenges, it’s almost impossible to construct a future scenario that doesn’t include a major (and I mean MAJOR) role for batteries from EVs to creating dispatchable power from renewable sources.

I think once the Giga factory gets up and running I think we are going to see major shifts in the coal markets in the US. We are also going to see major shifts in the power industry as a whole along with the death of the US ethanol industry.

The gigafactory isn’t even going to produce enough batteries for 1% of global auto sales.

It’s basically a pilot project for the world transition to plugins. Only when it succeeds will we start seeing the investment needed for the world to eventually go down the path you’re envisioning.

You’re right.. and on top of that despite marketing and misconception, Tesla doesn’t produce, design, or manufacture batteries. They take COTs batteries and create battery assembly packs.

Designing and mfg is exactly what the GigaFactory will be doing. And thereby double the world’s output.

They do design batteries and do make prototypes. They have posted positions for people to do such. They have also posted positions for engineers to design machinery to manufacture batteries as has SpaceX.

People in senior management have stated publicly that they essentially want to go fully vertical.

If you read the job descriptions for Lathrop, one flat out says they will be making production machinery for the manufacture of parts for Teslas. They will be making pneumatics, hydraulics, pumps and other things that are obviously not part of any electric car.

Read all the job descriptions. Clearly they will be making bespoke manufacturing equipment, a good way to save a ton money.

Musk is a Big DIY fan. That is how SpaceX got started. A recent post in the Tesla Motors Club Investors Forum speaks to this.

So they will machine and assemble parts of robots and such for Fremont and the Giggafactory.

There’s a quasi-bait-and-switch thing going on in distributed solar that will help battery sales.

The reason distributed solar makes sense is “net metering”. When you produce excess power, your meter rolls backwards, and you save up to 37c/kWh depending on your tier. But the utilities usually only pay generators 4-5c/kWh, so they’re losing way more revenue than they’re saving in cost through net metering. The profits from high tier customers are used to pay for the grid, its maintenance, lower rates for the poor, rebates, etc.

So I think net metering is going to die within a decade. At that point, if you want your existing solar array to cut your bill, you’ll need batteries.

I agree that it only works with net metering and Duke Energy has already announced plans to cut net metering by the end of 2014.

What I don’t understand is the utility company’s failure to understand how often PV and EV go together. It already accounts for 1 in 3 in California studies with a move toward 1 in 2. If the utility companies want to sell to the EV market at night, they are going to have to continue the net metering. Otherwise those of us who have both are going to be eager to purchase a battery from Elon. Some of us will do it on principle alone.

I think we’re going to see EV companies strike deals with utilities.

For example, consider Tesla selling mandatory $3 T-Gallons to buyers of a certain discounted model. You get 30 guaranteed miles with it, and Tesla uses part of the proceeds to cover your charging expense, as long as you charge at night. The rest is used to finance an upfront discount of $8,000 (and give Tesla a profit down the road).

No separate EV meter needed, coordinated charging load for the utility at night, and in return Tesla gets low rates.

This makes sense. When you realize that they make something like 90% of the car in-house. And the stated capacity at Fremont is as an assembly and body facility. Not a supplier parts manufacturing center. It should be interesting to see what they are doing with the space. CNC could be a lot of things. From small brackets and fittings to major parts of the transmission or motor. If I remember correctly they are still making the motors in house in Palo Alto??? And with the Daimler partnership and Models S/X they must be getting constrained. Hmmmm

The MB B-Class is using little 28kWh Tesla batteries. I wonder what volume that will grow to. ??

California’s central valley is full of water challenged farms, failed housing tracts and failing governments. Its actually a pretty cheap place to do business — if it weren’t for California’s out of control taxation.

Huh? California ranks #12 in per capita state tax burden, slightly better than New Jersey and only $200 per year more expensive than Arkansas or Wisconsin. (http://en.wikipedia.org/wiki/State_tax_levels_in_the_United_States)

Not low but certainly not “out of control” especially considering that it is a high per capita income state. California ranks #10 in per capita income, so the per capita tax burden is actually lower, proportional to income, than its income ranking would suggest.

But of course, California is a leading liberal state and so it is subject to FUD on a massive scale. Don’t believe it.

Some people never let facts get in the way of their political rants.

Just hope they don’t get “Regulated” to death.

And here they begin their China deliveries with first 9 cars:
http://www.globaltimes.cn/NEWS/tabid/99/ID/856210/Tesla-delivers-first-vehicles-in-China.aspx

Expected to sell nearly hundred cars per month in China.

That’s a very poorly written story.

“Electric cars in China are still confronted with a gloomy market reception due to safety concerns and battery life, said Zhang, noting that a Tesla electric car generally takes 30 hours to get charged and batteries are prone to become inflamed during charging.

Three Tesla electric cars reportedly caught fire last year around the world, due to overheated batteries.”

Very misleading since they did not mention that the batteries were punctured by road debris at speed, not simply overheated during charging.

You can pay CNC operators a lot less out there than you can in Fremont. The commute from cheap Central Valley housing to Fremont is terrible because geography. You can see on the map that there is only one viable way to drive from Lathop, Manteca or Tracy to Fremont.

Hmmm… Good point. I don’t suppose CNC Operators get paid $1,000,000 a year, do they?

Odd. I would have thought that they would still have way too much extra space at the Fremont facility.

That building in Lathrop is probably cheap enough that the labor cost makes a bigger difference. Staffing up in Fremont is not cheap and not necessary for small parts. Massive stamping and chassis assembly, sure. The cost of leaving large parts of the Fremont factory dark is trivial given the purchase price.

They are building out production lines in Fremont, and set to double this summer.

Tesla will need the entire Fremont factory for production lines by the time the Gigafactory is up and running. So they intend to coordinate both to ensure that inventory generated by battery factory will arrive to immediately be put to use in the production process. It will be just-in-time inventory management, German style.

Giga plant should be built in the San Joaquin county or El Dorado county. There is no reason to build the plant outside the state of California. Lots of low cost labor in those two regions.

They’re trying to dangle a carrot in front of Texas so the legislature won’t force their sales in the state to go through dealers. So far Texas has been hostile to them, but has lots of potential customers, and holding TX up as a potential candidate for giga-factory might change their minds. It only works if there are other contenders, such as AZ/NM/NV.

They’re even planning to “break ground” on two giga-factories in order to put the states in a prisoner’s dilemma against each other. Two states get their hopes up and whoever bends over backwards the farthest gets the building completed. Or eventually they need enough batteries to use both buildings.

In the long run they may wind up with a giga-factory in every state with lots of customers, just like there’s a military base in every state so that every Congressperson votes pro-DoD. Some very nice politicking by Musk there.

There will be several Gigafactories.

Maybe this is to make a surtain component for the chinese market, we know Musk whants to start build cars over their. Maybe he whants to still make parts like the motor and batery packs over in the us (porhaps to minimise the risk of “copy paste”)

A Guess: They are going to design, build and test build robots then ship them to plants.

There will be minimal labor at the gigafactory, as it will be heavily automated. Making their own equipment needed at the factory makes sense. Maybe Musk can export his robots to foxconn too.

6,500 jobs projected. Is that “minimal”?

Do you know whereto apply for jobs at the new plant?

Lad,
you are spot on. I don’t know if it will all be robots, but it will be mostly manufacturing equipment, tools and robots.

Dose any one know where to apply for jobs a the new plant in Lathrop?

I have a house for rent in Lathrop. $1800/mo, 2500sft, 5 bedrooms and 3 bath. Please let me know if anyone wants to rent! Text or call 925-828-7268 please. Thank you!!