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Morgan Stanley explains why Tesla’s first ‘Terafactory’ will be a perfect fit for Texas

The Cybertruck in off-road conditions. (Photo: humdinger_3d/Instagram)

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Morgan Stanley analyst Adam Jonas believes that Tesla’s newest electric vehicle production facility will land in Texas. In an investor’s note on Monday, the analyst gave six key reasons for why he believes Texas will be Tesla’s newest home.

The upcoming facility is expected to be dedicated for the production of the Cybertruck, which will require a different manufacturing system compared to Tesla’s previous cars. The factory will be massive, and in the first quarter earnings call, Musk even mentioned that the Gigafactories will probably be referred to as “Terafactories” soon.

Following are Morgan Stanley’s reasons why Texas may very well be the site of the Cybertruck’s “Terafactory.”

Tesla’s need to join other manufacturers in states

Jonas recognizes that Tesla is the only Original Equipment Manufacturer (OEM) to have its main production facility in California. While Michigan has long been the home of the American automotive market, Tesla has called California home since its early days. Tesla is as much of a technology company as it is a carmaker, and technology lives in Silicon Valley.

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However, Jonas sees unique disadvantages in having the main production facility located in CA. Concerning location and logistics, vehicle delivery times are extended for those who do not live in the western portion of the United States. Tesla owners who live on the East Coast are subjected to longer wait times for their vehicles due to transit and logistics delays. This is one of the main reasons a production facility that is centrally located in the country would be advantageous, Jonas says.

Texas has a hearty automotive manufacturing employment rate

Texas ranks fourth out of all fifty U.S. States in automotive manufacturing. This statistic comes from the US Department of Labor. Not only could Tesla increase its production rate as a company, but it could also provide a sizable economic boost by offering automotive production employment in a state that already has the enthusiasm for building vehicles.

Texas’ relaxed labor union representation fits Tesla’s bill

Jonas believes Tesla would prefer to operate in a state with a labor union representation that is not as heavy. Texas is a right-to-work state, where labor costs are affordable. Considering that the facility will be responsible for producing Tesla’s first pickup, the Cybertruck, along with the Model Y crossover, the workload will require a hefty workforce. Tesla will likely be looking to save where it can in a state that won’t break the company’s budget, and in Texas, The cost of doing business is significantly less than California, Jonas said.

Texas is a hotspot for renewable energy

Jonas recognizes Tesla’s identification as an “integrated renewable energy generation, storage, and transportation company.” Tesla would likely prefer a state with an abundance of renewable solar energy that could sustainably drive its manufacturing operations. Texas is a state with a warm and sunny climate, making it perfect for solar energy. The Morgan Stanley analyst noted that the state’s predictable climate and weather outlook would be beneficial to Tesla.

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Elon Musk’s SpaceX holds its operations in Boca Chica, Texas

SpaceX has held its operations in Boca Chica, Texas since 2012. While its main rocket facility is in Hawthorne, California, Boca Chica is where SpaceX chooses to launch some of its rockets. The site first launched a rocket on April 5, 2019. However, Jonas seems to believe that Musk’s comfortability with Texas and SpaceX could extend to Tesla. “Synergies in management time and, over time, possibly increased cooperation between Tesla and SpaceX make Texas an appealing option for the next U.S. Giga,” Jonas wrote.

Tesla’s presence in the heart of U.S. Oil and Gas is “symbolic”

Jonas and other Morgan Stanley investors said that U.S. lawmakers and the public might see a “symbolic and, in many ways, well-timed” investment by Tesla in Texas. The state has long been the heart of the United States’ oil and natural gas industry, and a sustainable energy company moving into Texas could be a hint toward the inevitable transition to clean energy.

While Tesla CEO Elon Musk has mentioned that the newest production facility is going to end up in the Central United States, there has been confirmation that Texas is indeed the definite the landing spot for the upcoming facility. However, Musk did use a Twitter poll to test the waters of Texas’ acceptance as the location of the newest factory, and the results were positive.

Both Musk and CFO Zachary Kirkhorn mentioned that the new production facility could be the company’s largest plant yet, hinting that it might be called a “Terafactory” instead. There is no indication of when Tesla will announce the facility’s final location. Still, Texas certainly seems like a very good fit for the Cybertruck facility.

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Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on X @KlenderJoey. If you're looking for great Tesla accessories, check out shop.teslarati.com

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Tesla Semi gets new product launch as mass manufacturing hits Plaid Mode

While the 1.2 MW Megacharger handles quick 30-minute en-route boosts, the Basecharger serves as a reliable overnight solution for longer dwell times at warehouses, distribution centers, fleet yards, and even, potentially, homes.

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Credit: Tesla

The Tesla Semi is getting a new production launch as mass manufacturing on the all-electric truck is gearing up to hit Plaid Mode.

Tesla has introduced a game-changing addition to its commercial charging lineup with the new 125 kW Basecharger for Semi. Launched this week as part of the new “Semi Charging for Business” program, this compact unit is purpose-built for depot and overnight charging of Tesla Semi trucks.

While the 1.2 MW Megacharger handles quick 30-minute en-route boosts, the Basecharger serves as a reliable overnight solution for longer dwell times at warehouses, distribution centers, fleet yards, and even, potentially, homes.

Delivering up to 60 percent of the Semi’s range in roughly four hours, perfect for overnight top-ups during mandated driver rest periods or while trucks are loaded or unloaded. Its fully integrated design eliminates the need for bulky separate AC-to-DC cabinets.

Tesla engineers tucked one of the power modules from a V4 Supercharger Cabinet directly inside the sleek post, resulting in a compact footprint. It also features a six-meter cable for layout flexibility. This is one thing that must have been learned through the V4 Supercharger rollout.

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Installation and operating costs drop dramatically thanks to daisy-chaining. Up to three Basechargers can share a single 125 kVA breaker, slashing electrical infrastructure requirements. The unit outputs 150 amps continuous across an 180–1,000 VDC range, matching the Semi’s high-voltage architecture while supporting the MCS 3.2 standard.

Tesla Semi sends clear message to Diesel rivals with latest move

Priced from $40,000 for a minimum order of two units, the Basecharger is far more affordable than the $188,000 Megacharger setup for two posts. Deliveries begin in early 2027. Buyers also receive Tesla’s full network-level software, remote monitoring, maintenance, and a guaranteed 97 percent or higher uptime—critical for fleet reliability.

This launch arrives as Tesla accelerates high-volume Semi production at its Nevada factory, targeting 50,000 units annually. By pairing affordable depot charging with ultra-fast highway options, Tesla removes one of the biggest obstacles to electrifying Class 8 trucking: infrastructure cost and complexity.

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Fleet operators stand to gain lower electricity rates during off-peak hours, dramatically reduced maintenance compared to diesel, and quieter yards at night. The Basecharger isn’t just another charger—it’s the practical bridge that makes large-scale electric semi adoption economically viable.

With the Basecharger handling “home” duties and Megachargers powering the road, Tesla is delivering a complete ecosystem that could finally tip the scales toward zero-emission freight. For trucking companies ready to go electric, the future just got a whole lot more charger-friendly.

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Tesla revises new Intervention Reporting system with Full Self-Driving

It is the second revision to the program as Tesla is trying to make it easier to decipher driver and owner complaints, but also to make it easier to report issues within the suite for them.

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Credit: Tesla

Tesla has revised its new Intervention Reporting system within the Full Self-Driving suite that now categorizes reasons that drivers take over when the semi-autonomous driving functionality is active.

It is the second revision to the program as Tesla is trying to make it easier to decipher driver and owner complaints, but also to make it easier to report issues within the suite for them.

With the initial rollout of Full Self-Driving v14.3.2, Tesla included a new reporting menu that gave four options for an intervention: Preference, Comfort, Critical, and Other. A slightly revised version of Full Self-Driving with the same ID number then came out a few days later, changing the “Other” option to “Navigation” after numerous complaints from owners.

It appears Tesla has listened to those owners once again and has not only made it smaller and more compact, but also easier to report the issues than previously.

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The new menu is now embedded within the request for a Voice Memo from Tesla, and does not block the entire screen, as the second rollout of the menu was:

There will likely be one additional revision to the Interventions Menu, as we have coined it here at Teslarati.

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Unfortunately, at times, there are no reasons for an intervention at all, but the menu does not give an option to simply disregard the reporting and forces the driver to choose one of the options. We, as well as other notable Tesla influencers, indicated that there is not always a reason for an intervention.

For example, I choose to back into my parking spot in my neighborhood at least some of the time for the reason of charging. I usually hit “Preference” for this, but it sends a false positive to Tesla that there was a reason I took over that I was unhappy with.

Tesla begins probing owners on FSD’s navigation errors with small but mighty change

Instead, I’m simply performing a maneuver that is not yet available to us. When Tesla allows drivers to choose the orientation at which their car enters a parking spot, I and many others won’t have to deal with this menu.

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Others are still skeptical that it will help resolve any issues whatsoever and prefer to disregard the menu altogether. It does seem as if Tesla will issue another revision in the coming days to allow this to happen.

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California hits Tesla Cybercab and Robotaxi driverless cars with new law

California just gave police power to ticket driverless cars, including Tesla’s Cybercab fleet.

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Concept rendering of Tesla Cybercab being cited by CA Highway Patrol (Credit: Grok)

California DMV formally adopted new rules on April 29, 2026 that allow law enforcement to issue “notices of noncompliance”, or in other words ticket autonomous vehicle companies when their cars commit moving violations. The rules take effect July 1, 2026 and officially closes a regulatory gap that previously let driverless cars operate on public roads with nearly no traffic enforcement consequences.

Until now, state traffic laws only applied to human “drivers,” which meant that when no person was behind the wheel, police had no mechanism to issue a ticket. Officers were limited to citing driverless vehicles for parking violations only. A well-known example came in September 2025, when a San Bruno officer watched a Waymo robotaxi execute an illegal U-turn and could do nothing but notify the company.

Under the new framework, when an officer observes a violation, the autonomous vehicle company is effectively treated as the driver. Companies must report each incident to the DMV within 72 hours, or 24 hours if a collision is involved. Repeated violations can result in fleet size restrictions, operational suspensions, or full permit revocation. Local officials also gained new authority to geofence driverless vehicles out of active emergency zones within two minutes and require a live emergency response line answered within 30 seconds.

Tesla Cybercab ramps Robotaxi public street testing as vehicle enters mass production queue

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California’s new enforcement rules arrive at a pivotal moment for Tesla. The company is ramping Cybercab production at Giga Texas toward hundreds of units per week, targeting at least 2 million units annually at full capacity, while simultaneously pushing to expand its Robotaxi service to dozens of U.S. cities by end of 2026. Unsupervised FSD for consumer vehicles is currently targeted for Q4 2026, and when it arrives, Tesla’s fleet may not have a human to absorb legal accountability, under the July 1 rules.

Tesla has confirmed plans to expand its Robotaxi service to seven new cities in the first half of 2026, including Dallas, Houston, Phoenix, Miami, Orlando, Tampa, and Las Vegas, with the service already running without safety drivers in Austin. Musk has said he expects robotaxis to cover between a quarter and half of the United States by end of year.

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