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Tesla Giga Berlin expansion faces roadblocks, but officials determined to find solutions
Tesla’s planned expansion of its German production facility Giga Berlin faces roadblocks as the automaker will need more water and electricity for operation, which may be in short supply. However, officials are determined to find solutions to the problems.
Brandenburg Prime Minister Dietmar Woidke assured Tesla and its CEO Elon Musk that the unresolved supply issues will be solved, and the local government is committed to finding a fix.
Tesla has been such an overwhelming contributor to the economy in Brandenburg that officials are willing to do whatever it takes to assure the automaker that any issues will be met with solutions.
The company has 10,000 employees and 140 trainees, Woidke said, adding that “Tesla has become Brandenburg’s largest industrial employer in less than a year.”
Woidke said, “We are looking forward to the expansion with great anticipation,” according to a letter seen by German media outlet Moz.de, knowing that power and water are still potential issues for the planned expansion of the plant.
However, Woidke is not willing to take anything but solutions as an answer and assured Tesla that the government will remain “unchanged and as reliable as in the past” and that it would come up with solutions to support the automaker’s expansion before the Summer.
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Woidke’s comments follow Economic Minister Jörg Steinbach’s meeting with Tesla brass in Texas. The two sides met earlier in March. Steinbach didn’t respond to Teslarati’s request for comment on the meeting, but it appears it was to assure the company that Brandenburg is committed to the company and the expansion of Giga Berlin.
“It was important to give Tesla the reassurance of the ongoing support of the Brandenburg government for the potential expansion,” Steinbach said in a Tweet.
Visiting our friends at Austin Gigafactory. It was important to give @Tesla the reassurance of the ongoing support of the Brandenburg government for the potential extension of #giga4 at Grünheide. Thx for the hospitality. @elonmusk @MarleneMehnert @rohanspatel pic.twitter.com/7BdS5kqJDU
— Jörg Steinbach (@joergstb) March 7, 2023
The Risks: Water and Electricity
Water and electricity are the main barriers to the expansion, with water being the largest concern. Tesla, while consuming far less than the industry average, still regularly deals with pushback from local citizens and the Strausberg-Erkner water association (WSE).
The major concerns are what the factory’s water usage could potentially do to the supply for the entire region.
Tesla’s usage, which has undercut other comparable companies in Brandenburg, has caused the State Environment Agency to lift the requirement that the WSE must be involved in groundwater-related issues, a report from rbb24 said.
Political groups have also called for Tesla’s operation to be restricted and do not feel as if the company should be given preferential treatment, criticizing Woidke and Steinbach for the support they’ve given the company.
Tesla Giga Berlin Expansion
Tesla has already started preparing the land it plans to build on for an expansion of the factory. At least 170 acres will be cleared to make way for new buildings that would support annual production of between 500,000 and 1 million vehicles per year.
The increased production would likely help Tesla alleviate reliance on imports from Gigafactory Shanghai, which has sent vehicles to Europe to support demand.
Giga Berlin has not struggled with production, however, and recently reached a run rate of 4,000 vehicles per week, a goal that was hit well ahead of schedule.
Tesla still must wait for a vote from government officials to approve the expansion plans. It was scheduled for December but delayed with no new date set.
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Tesla CEO Elon Musk posted a photo of himself standing with the Optimus production team inside Tesla’s Fremont factory, arms crossed amid workers in hard hats and safety vests. The image captures a pivotal industrial shift: the same facility space once dedicated to building Tesla’s flagship Model S sedan and Model X SUV is now home to the company’s humanoid robot manufacturing line.
Walking the Optimus production line in Fremont pic.twitter.com/ABS0tuRibW
— Elon Musk (@elonmusk) July 1, 2026
Tesla’s Fremont Factory, acquired in 2010 from the former NUMMI joint venture between Toyota and GM, has been the company’s original U.S. manufacturing hub since Model S production began in 2012.
The Model X followed soon thereafter. These premium vehicles offered lower annual volumes, recently around 30,000 combined, compared to the high-volume Model 3 and Model Y lines that continue around the site. Over their combined run, the S and X accounted for roughly 610,000 units.
In late January 2026, during Tesla’s Q4 2025 earnings call, Elon Musk announced the end of Model S and Model X production in Q2 2026. The final vehicles rolled off the line in early May. Rather than retooling for another vehicle, Tesla chose to convert the dedicated S/X assembly area into a dedicated Optimus Gen 3 production line.
Model 3 and Y manufacturing remains unaffected. Tesla’s official Fremont Factory page now lists Optimus alongside the 3 and Y as core products.
The conversion was executed with remarkable speed. After production stopped, crews dismantled the existing vehicle line and installed entirely new modular equipment—including lines sourced from Germany and dozens of sub-lines for actuators, batteries, and other components—in roughly four months.
Musk described the timeline as “insanely fast,” noting it would be unprecedented for any other manufacturer. Initial Optimus output is expected to ramp slowly due to the robot’s roughly 10,000 unique parts and the brand-new production processes involved. The Fremont line targets an eventual capacity of 1 million Optimus units per year.
Tesla isn’t joking about building Optimus at an industrial scale: Here we go
Optimus Development Timeline
- August 19, 2021: Optimus (then called Tesla Bot) formally announced at Tesla’s first AI Day. A concept video showed a person in a suit demonstrating the vision for a general-purpose humanoid capable of dangerous, repetitive, or boring tasks using the same AI architecture as Full Self-Driving.
- 2022: Early prototypes displayed. At the second AI Day in September, semi-functional units demonstrated walking across a stage and basic arm movements
- 2023: September videos showed improved capabilities, including sorting colored blocks, precise limb awareness, and holding a Yoda pose.
- 2024-early 2025: Factory integration videos showed Optimus navigating workspaces and handling objects like battery cells.
- January 2026: Gen 3 mass-production activities began at Fremont, with reports of over 1,000 Gen 3 units already operating inside the factory for real-world learning and AI training
- April 2026: Musk confirms Optimus production on converted Fremont line would begin in late July or August 2026. The Gen 3 reveal, originally eyed for Q1, was pushed closer to production start. A second, much larger Optimus factory at Giga Texas is under construction, with volume production targeted for Summer 2027 and long-term capacity of 10 million units annually
- July 1, 2026: Musk’s on-site visit and team photo confirm the Optimus line is operational and the transition is actively progressing
Tesla positions Optimus as potentially its largest project ever, leveraging vertical integration, AI expertise, and car-like manufacturing know-how to scale humanoid robots first for its own factories and later for broader industrial and consumer use.
The Fremont conversion serves as a critical proving ground for this ambitious new chapter in Tesla’s already-rich history.
Investor's Corner
Tesla gets its latest short from Michael Burry: ‘Happy it jumped back to this level’
Tesla short seller Michael Burry, the subject of the film “The Big Short,” where he was portrayed by Steve Carell, has revealed he has opened a new bet against the stock.
In a new update to his Substack newsletter in a post titled “Trading Post June 30, 2026,” Burry revealed a new set of bets against Tesla, Caterpillar, NVIDIA, Applied Materials Inc., and the iShares Semiconductor ETF.
In regard to Tesla, Burry wrote:
“And finally I shorted Tesla at 416.22. Happy it jumped back to this level.”
This means Burry likely opened his new short position after the company’s recent rally on Wall Street, which saw Tesla shares sink in mid-May, only to recover to well over the $400 mark. Currently, shares trade at around $427.
The company saw a big Tuesday as shares climbed considerably, over 10 percent. The size of the Tesla short was not provided, nor did Burry give any information on the position’s structure, the number of shares, dollar value, or whether options were used in the short.
The Tesla and SpaceX merger everyone is talking about is quietly building
Over the years, Burry has been one of the more vocal critics of Tesla, calling its share price “media inflated,” and saying it was “ridiculously overvalued” as recently as December.
The company has largely transitioned away from being known as an automotive company and instead is much more widely regarded as an AI play, mostly due to its Full Self-Driving efforts, Optimus robot development, and data collection related to both.
This has not pulled those skeptics away from being vocal about their distaste for how Tesla is valued, but there’s no denying that the company is a global force in many things, including sustainable energy, automotive, and AI.
Wedbush Securities is initiating stock coverage on SpaceX (NASDAQ: SPCX), marking the first comments on the company since it went public several weeks ago. Wedbush and its analyst handling coverage, Dan Ives, are widely bullish on fellow Musk company Tesla (NASDAQ: TSLA).
Ives wrote his first note initiating coverage of SpaceX shares on Wednesday with a $190 price target and an ‘Outperform’ rating. The firm believes the company is well positioned off of its IPO because of its wide array of projects, including AI compute power and infrastructure, connectivity projects, and launches.
“We view SpaceX as one of the most differentiated assets within the tech market with a strong footprint across its three core markets, with Starlink driving success with connectivity,” Ives wrote, “Starship launches leading to a demand flywheel and increasing deal flow for its Colossus clusters.”
Elon Musk called it Epic: The full story of SpaceX’s Starship Flight 12
Wedbush leans heavily on Starlink, which they say is the “profitability driver given the strength of its recurring revenue base of ~12 million subscribers as of June 5th.” Ives believes Starlink is still in the “early innings” of penetrating the global telecommunications and broadband market, as it only holds less than a 1 percent share. However, this number is sure to increase over time.
It also highlights the importance of Starship, which it says is an “essential layer” of SpaceX’s overall success. SpaceX developing and displaying the ability to reuse rockets is a major cost and reliability advantage “as it reduces the necessary hardware launch costs while generating a feedback loop for future flights to improve their launch flight rate without accelerating capex spend.”
Finally, SpaceX’s recent AI/Compute projects are also very elementary, Ives writes. It is worth mentioning Wedbush said its $190 price target is derived from a valuation forecast that sees the company yielding roughly $2.48 trillion of implied enterprise value.
There are also some factors that Wedbush did not take into account with its initial coverage. The firm wrote in the note:
“We note that there is optional value coming from Starship’s accelerating scale towards sub-$200/kg unit economics, orbital data centers, and enterprise AI monetization as these factors could drive meaningful upside but these face major hurdles, so we do not take that into account with our valuation.”
SpaceX shares are down just over 2 percent today, trading at around $167 at the time of publication.
Tesla Optimus project fires up as Musk sees production line progress
Tesla gets its latest short from Michael Burry: ‘Happy it jumped back to this level’
