Tesla’s ‘Gigafactory’ To Produce More Than Car Batteries

Tesla MotorsLast week, Tesla announced that it would build a new “Gigafactory” to produce lithium-ion batteries at a rate able to support the manufacture of 500,000 electric cars per year. By 2020, the plant will be capable of producing as many lithium-ion batteries as the entire world produced in 2013.

The Gigafactory, Tesla says, will support 6,500 jobs directly, and according to a post on the company’s blog, the company expects that volume manufacturing of its mass-market vehicle will drive down the cost-per-kWh of its batteries by 30 percent in the first year.

The mass-market vehicle, yet to be released, will be designated the Model E. According to a report in TechCrunch, it will be 20 percent smaller than the current Model S, with a target range of 200 miles. While that’s fewer than the maximum range of the Model S, it’s ahead of any other pure EV currently on the market. Cheaper batteries may be crucial in cutting costs sufficiently to allow the company to produce the more affordable car, but the new factory also plays into more diverse plans for the company.

Last week, the San Francisco Chronicle reported that as well as supporting vehicle battery production, documents filed with the Securities and Exchange Commission detailed that some of the lithium-ion batteries will be used for “stationary storage applications;” that is, batteries for storing energy for use in homes, commercial sites and utilities.

This makes sense, since Elon Musk, as well as heading Tesla, is also the chairman of California-based Solar City, an installer of solar energy systems to homes and businesses with a national reach. The Chronicle reports that the market for grid-scale storage could reach $30 billion by 2022, and a Morgan Stanley report published recently, argues the company could seize a commanding role in the the energy storage industry. Evidently, the new factory is more forward-thinking than just meeting EV production goals.

In the meantime, the location of the Gigafactory has yet to be determined, though Tesla has announced it will be in one of four possible states: Nevada, Arizona, Texas or New Mexico. According to USA Today, these “finalists” were chosen because each has both the climate and terrain suited for Tesla’s plan to power the factory largely with a sprawling farm of solar panels and wind turbines. The plant will need up to 1,000 acres, or close to 2 square miles.

USA Today reports that competition among the four states has set off a bidding war to try to attract Tesla’s business, stating that incentives being offered could reach new heights–including $200 to $400 million for site infrastructure and worker job training, and $300 to $600 million in tax breaks.

The choice of the winning state could also set up an interesting opportunity for Tesla to leverage some marketing opportunities, too. Many states, have challenged the legality of Tesla’s direct-to-customer sales model, whereby the company side-steps dealership involvement in the sales process. Lawsuits have been filed in many states based on existing automotive franchise laws, and Texas is one such state that has disallowed the company to sell to customers directly. USA Today suggests Tesla might demand the state change its laws to take dealer middlemen out of the equation as part of a winning deal.

But wherever the factory lands, it will be expensive. Tesla plans on selling $1.6 billion in bonds to help finance the plant; the company will invest $2 billion, while speculation exists that Tesla’s existing battery partner, Panasonic, might pitch in another $1 billion as well.

Image Credit: Sam Felder

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Phil Covington holds an MBA in Sustainable Management from Presidio Graduate School. In the past, he spent 16 years in the freight transportation and logistics industry. Today, Phil's writing focuses on transportation, forestry, technology and matters of sustainability in business.

3 responses

  1. The giga factory scheme could make or break Tesla. First Tesla should fix it is dirty little secrets, fire hazards.

    Tesla should relocate the traction battery to a safer place and better protect their batteries, before they start mass production.

    Lithium batteries are more likely to catch fire or and explode when punctured, then gasoline tanks. Customers of Nissan Leafs, Chevy Volts & Toyotas Rav4EV allegedly haven’t had any fires from road debris or vehicle accidents; yet Tesla has recently had three.

    There is a moral crisis at Tesla. Tesla needs to improve safety

    The fact is Teslas are a fire & EXPLOSION hazard. Safety is not a top priority for Tesla.

    3 Tesla traction batteries have caught fire. 2 Tesla traction batteries caught on fire after only running over road debris. 1 Tesla caught on fire & EXPLODED after an accident in Mexico.

    Allegedly the fire department said a Tesla model S. was the source of a garage fire in Toronto. At this time the specific cause is unknown. The traction battery and charger isn’t thought to be the cause.

    In the garage fire in orange county California a Tesla model S. charger connection is suspected by the fire department.

    Tesla Motors model S. charge connections have been overheating, melting and burning for about a year possibly longer, yet Tesla Motors has not resolve the problems. Since Tesla Motors did not resolve the problems, people went to the media and government. With pressure from the media and NHTSA Tesla finally issued a recall for about 30,000 model s. to replace the adapters new adapters with a thermal fuse. The thermal fuse is a step in the right direction, but there still seems to be an underlining fire hazard, since some of Tesla connectors don’t seem to be sufficient to carry the current for an extended time. Tesla Motors issued a software update and touted it a “fix”. The so-called “fix” did not work, charge connectors have continued to overheat, melt and burn. Though Tesla (Elon Musk) promised that the adapters would be mailed within two weeks, over a month later customers still have not received the replacement adapters with the thermal fuse. Almost all Teslas are under recall and are a fire hazard. Some customers claim under some circumstances the so-called “fix” can increase current and fire hazard when a fault is detected. The so-called “fix” seems to have a glitch that sometimes is a fire hazard.

    I think Tesla Motors recklessly located the lithium traction battery too close to the ground without enough protection.

    Tesla Motors is lagging behind in technology. Tesla Motors is reactive instead of proactive.

    Tesla Motors and Tesla fan boys are hostile toward safety advocates, critics and skeptics. Tesla and Tesla fan boys are bullies, slanderers & liars. Tesla Motors and Tesla fan boys resort to intimidation and censorship to suppress criticism, skepticism of the truth. Tesla fan boys are hatemongers. Tesla fan boys shill for Tesla.

    Regretfully for the most part the media has been shilling for Tesla Motors. The media needs to hold Tesla Motors accountable. The media needs to scrutinize and investigate Tesla.

    Will Tesla’s faulty designs result in deaths before people wake up and smell the coffee?

  2. Although this is great news, I’m disappointed that Tesla wants to take up so much land with this facility. This means it’s pretty much guaranteed to be in a rural area or the suburban fringe which doesn’t do much for urban employment or sustainability.

  3. Undeniable Facts About Tesla Motors:

    PART 1

    * Elon Musk did not create Tesla Motors. Elon Musk took over Tesla Motors and was sued for fraud by the actual founder.

    * Senator Dianne Feinstein arranged for Tesla Motors to get free State & Federal funding along with Solyndra. She, and her family, received stock benefits, HR contracts, construction contracts, supplier contracts, staff jobs and sales contracts for her efforts.

    * Tesla cars can be remotely hacked, and taken over, from anywhere in the world per a 60 Minutes, Fox & MSNBC newscast.

    * A Tesla suddenly swerved off a cliff in Sonoma, California and killed the driver.

    * A Tesla swerved into a bicyclist near Santa Cruz, California and killed the rider.

    * A Tesla crashed into a wall in Los Angeles, California and killed the driver.

    * A Tesla in California swerved into oncoming traffic and killed the oncoming occupants.

    * Tesla has been sued for homicide.

    * Tesla has been sued for fraud many times.

    * Elon Musk has been sued for fraud many times.

    * Tesla employees have been burned alive.

    * The batteries in the Tesla were never designed to be used in automobiles.

    * Tesla batteries are so sensitive that they can ignite and explode if they become wet or are knocked. Over 2000 published technical papers and lab test videos prove this as fact. Fisker, is out of business because millions of dollars of it’s cars, using the same lithium ion battery solution, got wet and burned into slag heaps.

    * The U.S. FAA has issued a film and report that proves that Tesla batteries can not only spontaneously ignite but also explode like a bomb.

    * Tesla’s have been recalled, at least, twice for starting fires. One time the battery chargers needed to be replaced for starting fires. The other time the entire floor of all of the cars needed a titanium shield to help reduce fires from bumps.

    * After claiming that sales in China would save Tesla, Tesla only sold 120 cars and had to fire it’s Chinese staff. China sees Tesla as a conduit to Obama’s funding and not only wants to cut off his funding but even got their university to demonstrate how easily the Tesla can be hacked.

    * The primary beneficiaries of Tesla were the campaign backers of the first Obama campaign.

    * Elon Musk had to divorce one ex-wife twice and per her two different hush-money amounts.

    * Tesla has been sued for “Lemon Law” violations which stated that the car was shoddilylt by inexperienced workers.

    * Per Federal MSDS documents, when the Tesla batteries are on fire, they release toxic smoke which can give the occupants and by- standers brain cancer, liver cancer and toxilogical poisoning.

    * Fire Departments are ordered to wear the highest level of HazMat gear when dealing with a Tesla on fire.

    * Tesla booked it’s free state and federal tax credits as “profit” when it issued it’s investor reports.

    * Tesla was caught sending emails to its staff and potential buyers stating that it wanted to book potential sales as fully received revenue.

    * Tesla has paid bloggers to act as “meat puppet” promoters on the web to make it appear that there is a large group of supporters when, in fact, these “meat puppets” are hired shills.

    * Tesla investors have personal, and financial relationship,s with CBS Bay Area, Reddit, Google, San Jose Mercury News, Hearst Corporation, and other media outlets, and forbid them from publishing negative articles about Musk or Tesla.

    * Google investors and staff own part of Tesla.

    * Tesla analysts have engaged in the process called “pumping the stock.”

    * Tesla is so frightened of owners publicly disclosing the many problems with the car that they require buyers to sign non-disclosure agreements.

    * Every major Tesla investor was a campaign contributor.

    * At the time that the U.S. Department of Energy was reviewing Tesla’s application for funding, Tesla was technically bankrupt, as disclosed by Tesla staff, and had the worst debt-ratio of any applicant. According to the federal section 136 law, this made it illegal to give Tesla the money but they were given the money based on “special orders”.

    * At the time that the U.S. Department of Energy was reviewing Tesla’s application for funding, Erick Strickland of the NHTSA was reviewing documents that said that the Tesla batteries would explode. He later quit the NHTSA on 48 hours notice.

    * 80% of the Tesla investors owned stock interest in Afghanistan lithium and indium mining used for Tesla and Solyndra. As of 1/1/15, The Afghan war has cost U.S. taxpayers $6 Trillion.

    * Without free non-competitive federal cash and credits, in a fair-market layout with special-interest protections, Elon Musk’s 3 companies would not exist today.

    * No documentation, for buyers of the Tesla, ever disclosed the fire danger, hacking danger or lethal fumes toxicity issues.

    * Panasonic, the maker of the Tesla battery cells, has been charged with corruption, price fixing, dumping and the deaths of thousands of it’s employees in battery factories and nearby towns, from toxic materials.

    * Elon Musk spends more per month, on personal PR and promotion than any other billionaire in America.

    * On 60 Minutes, while Elon Musk was being interviewed about his rockets, he cried when the interviewer told him that real astronauts thought he was a poser. So far, Space X has had three times more explosionsand failures tha NASA ever had in the same point in their agency history.

    * When part of NASA’s budget was gutted and many NASA staff were fired, Space X immediately received a contract for the same services that had just been curtailed at NASA.

    * The NUMMI plant, that Tesla took over, next door to Solyndra, was said to “not ever be a possibility for Tesla to use” in the news, by Elon Musk. Dianne Feinstein arranged for Tesla to use NUMMI and told NUMMI workers they would all be employed. Most were not hired and Tesla hired off-shore workers to replace many of them.

    * There are thousands of news articles online that charge that Tesla Motors was funded as a political kickback operation and that it was about skimming the funding fees more than building the cars.

    * Even though the federal funding discouraged applicants from using taxpayer money to build buildings, due to the glut of empty factories, in America, at the time, Tesla tried to build buildings in multiple cities, got sued for fraud by some of the cities and then went to NUMMI. In every city deal, the property rights deals were designed as tax write-off profits for Tesla investors.

    * Tesla owners have blogged about over 150 defects with the car ranging from noise, to thermal issues, to range issues to get getting locked in the car and getting locked out of the car.

    * Goldman Sachs was involved in every part of the Tesla deals. Goldman Sachs is under investigation by Congress, and others for minerals commodity manipulations of minerals used in Solyndra and Tesla. Solyndra Afghan chemicals, in the Solyndra solar tubes spontaneously caught fire when installed on roof-tops.

    * Elon Musk once spied on all of his employees by sending each one a different email with a slightly different secret in it to try to find out who was ratting him out.

    * Tesla told the U.S. Department of Energy, in it’s writtem submission, that their car would cost 40% less and sell 2000% more than it actually did.

    * Tesla had no actual design for the Model S when it submitted it’s materials to the U.S. Department of Energy. What was submitted by Tesla was artists ideas. Tesla then used the taxpayer money to figure out what it was going to do. The Tesla Model S has no engineering it in that was submitted to the U.S. Department of Energy.

    * Bright Automotive, a competing applicant against Tesla in the Department of Energy funding, beat Tesla on every financial and engineering metric and had more customers demanding the car yet Bright Automotive got sabotaged by DOE staff because Bright did not make campaign contributions.

    * Most of the Department of Energy “reviewers” had a financial and/or political connection to Tesla Motor’s investors.

    * Tesla Motors staff had personal relationships with all of the key White House staff of the first Obama White House. They all quit the White House mid-term.

    * Emails and whistle-blower documents reveal that White House staff coordinated the Department of Energy Funding and that Steven Chu had a personal relationship with almost every Tesla investor and advisor. Steven Chu’s nomination documents are mostly authored by Tesla investors and their associates.

    * During the Tesla application process with the DOE, the Tesla design was $200,000.00, PER CAR, overbudget, yet this was not disclosed.


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