To Pump Up Production, Tesla Acquires Grohmann Engineering, Forms Tesla Advanced Automation Germany

11 months ago by Eric Loveday 41

Tesla Fremont Factory

Tesla Fremont Factory

Some Details On Grohman Engineering - Click To Enlarge

Some Details On Grohmann Engineering – Click To Enlarge

In order to up production to Tesla’s previously announced target of 500,000 cars per year (mostly Model 3s) by 2018, Tesla has decided to acquire a “world-renowned engineering company” based in Germany to assist the automaker in the area of automated manufacturing systems.

The engineering firm is known by the name of Grohmann Engineering. As Tesla states:

“After increasing our output target to 500,000 cars per year by 2018, we began searching for the best engineering talent in automated manufacturing systems. Today, we are excited to announce that Tesla has entered into an agreement to acquire Grohmann Engineering, a world-renowned engineering company in Prüm, Germany, which will become Tesla Grohmann Automation.”

The newly formed Tesla Grohmann Automation will be tasked with designing and producing “several critical elements of Tesla’s automated manufacturing systems.” With that in mind, Tesla says it’ll add “1,000 advanced engineering and skilled technician jobs in Germany over the next two years.”

Additionally, the Grohmann site in Prüm, Germany will “serve as the initial base for Tesla Advanced Automation Germany headquarters, with other locations to follow.”

Lastly, Tesla states:

“To date, we have increased the production rate at our Fremont Factory by 400% in four years, and we expect this acquisition to accelerate that growth rate. While the agreement is contingent upon clearance from regulators, including in Germany, we hope to have full approval and close the acquisition in early 2017.”

More info in the press blast below:

Formation of Tesla Advanced Automation Germany

The Tesla Team November 8, 2016

Accelerating a sustainable energy future is only possible with high-volume factories. They allow us to manufacture high-quality products with economies of scale, making them more affordable and accessible to the world. As the machine that builds the machine, our factories are so important that we believe they will ultimately deserve an order of magnitude more attention in engineering than what they produce. At very high production volumes, the factory becomes more of a product than the product itself.

After increasing our output target to 500,000 cars per year by 2018, we began searching for the best engineering talent in automated manufacturing systems. Today, we are excited to announce that Tesla has entered into an agreement to acquire Grohmann Engineering, a world-renowned engineering company in Prüm, Germany, which will become Tesla Grohmann Automation.

Led by founder and CEO Klaus Grohmann, Grohmann Engineering is one of the world leaders in highly automated methods of manufacturing. This transaction will bring Mr. Grohmann’s leadership, a world-class team and unique expertise in-house. Moreover, it will serve as the initial base for Tesla Advanced Automation Germany headquarters, with other locations to follow. We expect to add over 1,000 advanced engineering and skilled technician jobs in Germany over the next two years.

Under the continued leadership of Mr. Grohmann, several critical elements of Tesla’s automated manufacturing systems will be designed and produced in Prüm to help make our factories the most advanced in the world. Combined with our California and Michigan engineering facilities, as well as other locations to follow, we believe the result will yield exponential improvements in the speed and quality of production, while substantially reducing the capital expenditures required per vehicle.

To date, we have increased the production rate at our Fremont Factory by 400% in four years, and we expect this acquisition to accelerate that growth rate. While the agreement is contingent upon clearance from regulators, including in Germany, we hope to have full approval and close the acquisition in early 2017. We are excited to have the Grohmann team join us in our goal of becoming the best manufacturer in the world to help accelerate the world’s progress to a sustainable energy future

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41 responses to "To Pump Up Production, Tesla Acquires Grohmann Engineering, Forms Tesla Advanced Automation Germany"

  1. a-kindred-soul says:

    Very good decision. Get German know how, precision and solid planning on board, at the same time killing any sentiment in Europe and especially Germany in the bud that Tesla is a threat for the German automotive industry. Now it is part of the German automotive industry.

    This also shows Tesla is totally serious about what it has been promising all the time: an enormous uptick in production. Tesla is not about words, but about doing.

    1. pjwood1 says:

      Musk knows the way to get regulation on your side goes beyond the environment. “Jobs, jobs, jobs”, is where you’ll find the most friendly ear. I do have to wonder, though, if 1,000 Grohmann jobs means a net fewer jobs in the auto sector?

  2. Cavaron says:

    Northrop Grumman was yesterday, now we have: Tesla Grohmann! 😉

  3. William says:

    No wunder Toyota just decided, just yesterday, to jump, head first into offering a full production (non compliance) EV in 2020. Honda might be the last to the table, if Ford doesn’t pull the trigger first. Who will be the last major OEM to go “All IN”?

    1. Mike says:

      Fiat/Chrysler will be the last of the major auto makers. They seem incapable of giving up Jeeps and big pickups.

    2. agzand says:

      Ford recently has been under the radar. They introduced the new GT out of the cold. I won’t be surprised to see a 200+ mile Ford BEV in very near future.

  4. Big Solar says:

    Just dont let the germans over engineer anything please!!!

    1. Ocean Railroader says:

      I Agree with that a lot cars are over engineered or made to complex. One of the most expensive cars we had was a German car that had so many complex parts break on it every other week it was a driving money pit.

    2. georgeS says:

      @Big Solar
      Good one about German over engineering. You have to have a sense of humour about the Germans. They are excellent engineers! (but a PITA to work with)

  5. Kdawg says:

    I hope you like Siemens controllers/products.. yuck.

  6. CDAVIS says:

    Tesla acquiring Grohmann Engineering is an interesting move by Tesla especially considering that Grohmann is often the go-to engineering firm for German automakers including in the field of advanced EV systems. For example, in 1914 Grohmann received from BMW the “Supplier Innovation Award” (in honer of outstanding innovations) related to BMW’s i8 high-voltage battery.

    1. Philip Reeve says:

      That would have been in the early days of WWI then, CDAVIS. ?

      1. Nick says:

        BMW was serious about the i8. They didn’t rush it to market. 🙂

        1. ¯\_(ツ)_/¯ sven says:

          And I thought Tesla was bad when it repeatedly delayed the Model X launch date for years. 😀

      2. CDAVIS says:

        Lol…my typo “1914” should read “2014”

  7. Mister G says:

    Wow sweet move Elon, but fossil fuel industry and gas guzzler manufacturers will try to block this move. GO TESLA GO…HILLARY HILLARY HILLARY for POTUS

    1. ¯\_(ツ)_/¯ sven says:

      The Chinese are on a tech buying spree in Germany, offering well above fair market value in cash for their tech company acquisition targets. Germany only recently started blocking Chinese companies from buying their tech companies after the Chinese made a bid for German robot maker Kuka, the main supply of robots to German car manufacturers.

      “China is strategically buying up key technologies in Germany while protecting its own companies against foreign takeovers with ‘discriminatory requirements,’ German Economy Minister Sigmar Gabriel said on Saturday.”

      “‘Nobody can expect Europe to accept such foul play of trade partners,’ Gabriel wrote.”

      http://fortune.com/2016/10/29/germany-china-tech-takeover/

      http://fortune.com/2016/10/26/aixtron-us-pressure-takeover-china/

      If Hillary wins, I sure hope the Chinese didn’t buy her off through the Clinton Foundation like the Russians did when they bought Uranium One, giving the Russians control of one-fifth of all uranium production capacity in the United States. After $2.35 million in Russian money flowed into the Clinton Foundation and Hillary received a $500,000 speaking fee from a Kremlin-linked Russian investment bank promoting the uranium deal, Secretary of State Clinton approved the deal for Russia d to buy up uranium mines in the US and Canada. As always with the Clintons, all you have to do is follow the money.

      From the NY Times:
      “Uranium One’s chairman used his family foundation to make four donations totaling $2.35 million. Those contributions were not publicly disclosed by the Clintons, despite an agreement Mrs. Clinton had struck with the Obama White House to publicly identify all donors. Other people with ties to the company made donations as well.”

      “And shortly after the Russians announced their intention to acquire a majority stake in Uranium One, Mr. Clinton received $500,000 for a Moscow speech from a Russian investment bank with links to the Kremlin that was promoting Uranium One stock.”

        1. Get Real says:

          LOL, sven is showing his Trump tendencies again!

          Notice sven conveniently leaves out Trump’s Russian connections.

          http://heatst.com/world/exclusive-fbi-granted-fisa-warrant-covering-trump-camps-ties-to-russia/

          http://time.com/4433880/donald-trump-ties-to-russia/

      1. AlphaEdge says:

        Also look up the money that Morocco and Sweden gave to the Clinton foundation, and Bill was sent to Sweden to give a speech for a pile of cash. All this was done, when she was Secretary of State.

      2. pjwood1 says:

        Thanks, sven. Not surprised. Robert Rubin, the CFMA, and “Graham, Leach, Blighley”(repealing Glass Steagal) were other neat Clinton ideas.

        What does uranium do for Russia, anyway? Do countless nuclear bombs have a shelf life? The commodity has been in the dumps ever since Fukushima. Desptie eventually soaring past the “2 degree” amount of CO2, I doubt idealists will be reaching for uranium in the next 10 years. I think we need more coastal erosion, rising temps and social justice, first 😉

        Maybe Russia is betting on the liklihood renewables won’t be able to adequately blunt the ~2025 peak, in emissions. There, they would be correct:
        http://images.huffingtonpost.com/2015-11-17-1447758355-1076582-3.jpg

      3. Mister G says:

        Sven, what you described is the “real world”, Trump would not be any different lol…what is different between both candidates is that Hillary believes in man made global warming and will continue Obama’s global warming policy, Trump would undo all of it. Makes it easy for me to vote for HILLARY HILLARY HILLARY.

  8. Josh Bryant says:

    This should be less controversial than the last acquisition.

  9. floydboy says:

    Now Tesla’s really gonna Groh mann!?

    1. georgeS says:

      LOL

  10. speculawyer says:

    Nice. Buying a ready made team of manufacturing experts should be a good move.

    1. georgeS says:

      @spec
      I can just see the looks on the Germans faces when they have their first meeting with Elon and Elon announces no more 1 month off in the summer. All hands on deck 24/7, 12 months a year. Bring your sleeping bags to work.

      1. Belidonk says:

        Well I hope that Musk is smarter then that, because the absolute minimum by law in Germany is 20 workdays.
        Normal is 28-30 workdays per year and part of the contract between employer and employee. You want to get around that?
        I wish you luck with the german unions and lawyers 😉

  11. Someone out there says:

    Is Elon aware that you don’t have to purchase a company to use its services?
    What’s next then, buying the chemical company that makes their paint?

    1. ItsNotAboutTheMoney says:

      If you really want a company’s full set of skills, you make them part of your company.

    2. Joshua Burstyn says:

      Maybe. If anything the company would have technology that makes paint less toxic. This fits the Tesla mantra.

  12. Four Electrics says:

    Elon thinks that manufacturing is like software: just change the algorithm for a 10x speed up. Easy, right?

    1. ItsNotAboutTheMoney says:

      Have you not been paying attention to what SpaceX and Tesla have been doing?

      Elon certainly does not think it’s like software. Elon Musk sees manufacturing as an engineering problem that needs to be solved by smart engineers.

      1. Peter says:

        “Elon certainly does not think it’s like software. Elon Musk sees manufacturing as an engineering problem that needs to be solved by smart engineers.”

        The same applies to software…

  13. Peter says:

    Please note Grohman makes battery cell manufacturing systems, not (other) car part manufacturing systems according to their German Wikipedia page: https://de.wikipedia.org/wiki/Grohmann_Engineering

    This article doesn’t really mention anything about what it is they make, but it’s battery cell manufacturing systems.

  14. Peter says:

    So what will the company actually be named?
    Tesla contradict themselves in this article.

    “Tesla Grohmann Automation” is mentioned three times in this article.

    But “Tesla Advanced Automation Germany” is mentioned 4 times in the article including the title.

  15. agzand says:

    There is a lot of excess capacity around the world. Tesla should hire or use that capacity instead of adding their own capacity.

  16. Hauer says:

    “Tesla Advanced Automation Germany” seems to be a vessel for further acquisitions. With “Tesla Grohmann Automation” only a part of TAAG.

  17. Some Guy says:

    It’s really fascinating. One thinks there is no surprise between Solar Roof and Solar City acquisition, and then this brilliant move comes totally unexpected. Grohmann is one of those smaller sized companies that are the “Go-to” guys in development and construction of automated assembly lines (of all purposes, not just battery cells). They are so good they don’t have to advertise or even need a fancy website. The car manufacturers come to them and ask them to build them manufacturing equipment and pay a pretty penny.
    Now it’s all becoming Tesla in-house know-how, and the new Tesla-employees are even more motivated to make it happen. And the ICE competition will have to look elsewhere for someone to develop Tesla-speed assembly lines for them. (Unless they don’t want to pay Elon to do it for them. But then again, Elon would probably do it to end both the ICE-Age and global warming together in one strike).

    1. CBonville says:

      “…end both the ICE-Age and global warming together in one strike.”

      Brilliant. #beforetheflood