Tesla’s Gigafactory 4 in Berlin, Germany will reportedly begin construction around January 2020. This comes just after Tesla reportedly reached an agreement with local government officials to purchase a piece of land where the company’s electric vehicle and battery production facility will be built.
CEO Elon Musk announced that Berlin would become the home of Tesla’s next vehicle production factory last month. A report from Deutsche Bank appearing to be published on December 9 states the company “expects construction to start in Berlin around January 2020 and will begin with Model Y production and then Model 3 will follow.” Following the announcement of Gigafactory 4 at the Golden Steering Wheel Awards in Germany, Musk tweeted that the factory “will build batteries, powertrains & vehicles, starting with Model Y.”
1. construction start January 2020
2. vehicle production in 2021, max 2 years
3. Model Y first, Model 3 to follow
4. investment cost Shanghai +alpha pic.twitter.com/ABdBY15hLJ
— JPR007 (@jpr007) December 10, 2019
Tesla expects Model Y production at Gigafactory 4 to begin in 2021, or “a maximum of two years after the groundbreaking ceremony.” It is not known when Tesla will begin Model 3 production, nor is the exact dollar figure of how much the company will invest in the upcoming facility. However, there is speculation that the cost will be “slightly” higher than the estimated $2 billion investment Tesla had building Gigafactory 3 in Shanghai, as noted by the Shanghai Planning and Land Resources Administration.
According to Bild, Tesla’s purchase agreement for 300 hectares of land for production and logistics space will become valid following approval from Brandenburg’s Finance Committee. However, the electric car maker based out of Silicon Valley, California reportedly plans to begin building its new plant before approval is received. “Tesla is likely to start at his own risk even before the approval, if a positive decision can be expected,” Brandenburg Minister of Agriculture, Environment and Climate Protection Axel Vogel said.
Economy and Energy Minister Joerg Steinbach says the project is on schedule and “the building area is expected to be cleared by mid-March.” Steinbach and other government officials have been openly supportive of Tesla’s presence in Germany. Economy Minister Peter Altmaier was alongside Steinbach at a press conference in Potsdam, Germany following the announcement of Gigafactory 4, where they spoke highly about Tesla’s decision.
“We see it as recognition of Germany as a location for making cars. We think we now have the chance, in the coming years, to become an important international centre in this future-oriented sector,” Altmaier said.
Musk and Tesla saw several advantages in bringing the company’s new factory to Germany. “Everyone knows that German engineering is outstanding, for sure. That’s part of the reason why we are locating our Gigafactory Europe in Germany,” the Tesla CEO stated. Tesla expects Gigafactory 4 to assist in the production of its increasingly popular vehicles, especially the Model Y crossover, a vehicle that will be competing in the highly competitive crossover segment, which is among the most lucrative in the auto market.