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Tesla Gigafactory 3 complex sees preparations for next, big expansion

Tesla Gigafactory 3 site as of September 2019. (Credit: Jason Yang/YouTube)

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Recent footage of Tesla’s Gigafactory 3 complex in Shanghai suggests that the electric car maker’s construction partner is busy preparing for what appears to be the buildout of another massive facility at the south end of the general assembly building. Neither Tesla nor local reports have revealed what the upcoming facility will be, though recent tweets from CEO Elon Musk suggest that the new building could help Gigafactory 3 produce batteries and powertrains for the Model 3 and Model Y. 

During a recent interaction on Twitter, Musk mentioned that Gigafactory  Shanghai will produce “cars, batteries & drive units” at the same site. This is a far different strategy from Tesla’s current setup in the United States, which involves vehicle assembly being performed in the Fremont factory, and battery and drive unit production being done in Gigafactory Nevada. Tesla’s setup in China will likely prove beneficial for the electric car maker, as parts manufacturing and vehicle assembly could be accomplished in one complex. 

Gigafactory 3’s Phase One construction was recently completed, with the site’s general vehicle assembly building practically ready for activation. Images and a video taken inside the massive building suggests that a Model 3 assembly line is already in place, and manufacturing robots have been set up. In the days leading up to Elon Musk’s recent visit to China alone, pictures from Gigafactory 3’s interior revealed that the electric car maker is already conducting trial runs on the Model 3 assembly line. 

Yet with Phase One being complete, much of the more visible updates to the Gigafactory 3 complex lies in the southern end of the site, where several cranes and pile drivers are currently deployed. The very same machinery were deployed in the early days of the general assembly building’s construction, which suggests that preparations are now underway for another massive buildout in the Gigafactory 3 complex. The area where these activities are ongoing could be seen in a recent video from drone operator Jason Yang, who has been following the site’s development since its groundbreaking ceremony back in January. 

https://twitter.com/vincent13031925/status/1173428298652647425?s=20

Apart from the potential size of the new structure that will be rising from Gigafactory 3’s Phase 2 buildout, the ongoing pace of work at the site is also very impressive. Statements from several workers on the complex indicate that activities in Gigafactory 3 continue to adopt a 24/7 scheme, despite the Phase One stage being completed. This means that since the earliest days of its buildout, neither Tesla nor its Chinese construction partner have let up in their efforts to finish the facility in the fastest time possible. 

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When he attended Gigafactory 3’s groundbreaking ceremony, Tesla CEO Elon Musk stated that trial Model 3 production runs could start as early as the end of 2019. So far, the pace of Gigafactory 3’s construction has exceeded this, with local reports suggesting that the general assembly building could start Model 3 trial production runs as soon as the southwest substation is ready for operation. Interestingly enough, reports have suggested that the substation could go online as early as the end of September

Watch the recent drone flyover of the Gigafactory 3 complex in the video below. 

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Elon Musk explains why Tesla stepped back from Project Dojo

The update was initially reported by Bloomberg News, which cited people reportedly familiar with the matter.

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(Credit: Tesla)

Elon Musk has confirmed that Tesla is stepping back from its Dojo supercomputer initiative and focusing instead on the company’s in-house AI5 and AI6 chips. 

The update was initially reported by Bloomberg News, which cited people reportedly familiar with the matter.

Project Dojo Ends

As per Bloomberg, Peter Bannon, who led Project Dojo, will be departing Tesla following Elon Musk’s decision to shut down the initiative. The publication claimed that Tesla’s Project Dojo team has lost about 20 members recently, and the remaining members of the initiative would be reassigned to other data center and compute projects within Tesla. 

Dojo was expected to help Tesla train its Autopilot and Full Self-Driving systems. With this change, Tesla will reportedly be increasing its reliance on external partners for its training hardware. These partners reportedly include Nvidia, AMD, and Samsung, among other companies.

Credit: Elon Musk/X

Musk Explains Dojo Shutdown

In a series of posts on X, Elon Musk explained that it doesn’t make much sense for Tesla to divide its resources to scale two different chip designs. And since the company is putting in a lot of effort in its AI5 and AI6 chips–which would be used not for training but in actual products like Optimus and the Cybercab–it was time for Project Dojo to take a bow.

“It doesn’t make sense for Tesla to divide its resources and scale two quite different AI chip designs. The Tesla AI5, AI6 and subsequent chips will be excellent for inference and at least pretty good for training. All effort is focused on that.

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“In a supercomputer cluster, it would make sense to put many AI5/AI6 chips on a board, whether for inference or training, simply to reduce network cabling complexity & cost by a few orders of magnitude. One could call that Dojo 3, I suppose. The difference in real-world performance between AI4 and AI5 is far more than any chip version I’ve ever heard of by a lot. It’s real good,” Musk wrote in his post.

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Tesla creates clever solution to simplify and improve its Service

Raj Jegannathan, a Vice President of IT/AI-Infra, Apps, Infosec, and Vehicle Service Operations, revealed that Tesla has started a small pilot program at a few service locations to combat this issue.

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tesla service
Credit: Tesla

Tesla has created a clever solution to simplify and improve its Service. Tesla performs most of the services that are needed on its vehicles at its company-owned Service Centers.

However, service has been a weak point of the company, as some regions have fewer Service Centers than others. This can cause long wait times for Tesla owners in some parts of the country.

There are also instances where customers do not agree with what Tesla is saying about their vehicle. In fact, one instance that revealed this new change Tesla is making to its Service was precisely that.

One owner posted on X that his vehicle’s battery seal had failed after a recall was issued. Tesla insurance and Tesla Service both did not assist, and it took CEO Elon Musk stepping in to get the issue resolved:

Another owner suggested there should be a more streamlined communications process between the customer and the Service Center, a solution that has been missing.

Raj Jegannathan, a Vice President of IT/AI-Infra, Apps, Infosec, and Vehicle Service Operations, revealed that Tesla has started a small pilot program at a few service locations to combat this issue.

Elon Musk wants Tesla Service to fix two-thirds of cars in the same day

Jegannathan said that Tesla has started to share local and regional leader contact information so customers have the ability to reach out when they have complaints or disagree with warranty claims, changes in estimates, or initial diagnostics.

It is available in a handful of locations already, and Jegannathan said that once abuse guardrails are built, this will expand to all locations:

This would be a major improvement in the Service portion of Tesla’s business. There are common disagreements between Service and customers, specifically when Service’s suggestions don’t align with the customer’s beliefs.

When it comes to things like a warranty claim, these issues are not really up for interpretation. Instead, the repairs should be made. If there is a misunderstanding on Service’s side, a simple message from the customer could have resolved the issue. That’s basically what happened here.

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Investor's Corner

Tesla gets its best analysis from Morgan Stanley as ‘it’s all about to change’

He maintained its ‘Overweight’ rating and the $410 price target Morgan Stanley had on the stock.

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(Credit: Tesla)

Tesla has gotten perhaps its best analysis from Morgan Stanley in quite some time, as the Wall Street firm claims that “it’s all about to change.”

That phrase could be used for both the company’s status and the world in general.

Analyst Adam Jonas said in a new note on Thursday to investors that Tesla could be one of the major winners in terms of the global transition from what it is now to what it will be.

He describes the global shift that will occur over the next few years:

“Have you interacted with a robot today? Have you even seen a robot today? No? Well, take a mental picture because it’s all about to change. When we meet someone who has never been in a Waymo or a Tesla Cybercab (which is most people), we frequently see a wince and a response such as ‘I’m not sure I’d feel comfortable getting in a car without a driver.’ We imagine going back in time to 1903 and asking people if they’d feel comfortable in an airplane.'”

The same technological revolutions that have occurred over the past 150 years will continue to occur again and again. We are on the verge of another, Jonas believes, as companies like Tesla are working on artificial intelligence tech, which includes changing the way we look at things like transportation and labor.

Jonas includes an interesting tidbit in his note about how humanoid robots could change wages, and how it could work into the advantage of Tesla, especially as it is developing its own Optimus robot:

“We estimate 1 humanoid robot at $5/hour can do the work of 2 humans at $25/hour, generating an NPV of approximately $200k/humanoid. 1 robot shaped car can potentially drive down cost/mile of a ride share vehicle to <$0.20 mile (1/10th human-driven ride-share).”

Jonas sees Tesla as a key player in how AI will impact things like manufacturing and various automotive industries, and he believes there is long-term potential for AI, robomobility, and even autonomous eVTOL platforms.

Tesla stock: Morgan Stanley says eVTOL is calling Elon Musk for new chapter

He maintained its ‘Overweight’ rating and the $410 price target Morgan Stanley had on the stock.

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