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Tesla Gigafactory 3 substation on track for activation by end of September

Tesla Gigafactory 3's substation under construction. (Credit: Wuwa Vision/YouTube)

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Reports from local Chinese news outlets are suggesting that the substation for Tesla’s Gigafactory 3 site in Shanghai is on track to begin operations by the end of September. The update comes amidst news that workers in the site have laid 16.7 km (10 miles) worth of cabling for the facility. With the cabling in place, Gigafactory 3 has taken yet another step closer to its activation. 

Similar to Tesla and its construction partner’s other projects in the Gigafactory 3 complex, the buildout of the substation also saw a significant degree of support from the local Shanghai government and its related departments. Barring any delays in its end-of-September target, the activation of Gigafactory 3’s substation could end up taking no more than 159 days, which is about twice as fast as normal. 

https://twitter.com/vincent13031925/status/1171482798516912135?s=20

The completion of the southwest substation is key to the operations of Tesla’s electric car production facility. Once the substation is complete, it will be capable of transmitting power to the rest of the Gigafactory 3 complex, which could, in turn, open the doors for trial Model 3 production activities. Thus, if the substation starts operations in late September, trial production runs of the Model 3 at Gigafactory 3 this month could be plausible.

Recent videos taken of Gigafactory 3 suggests that the buildout of Tesla’s Model 3 and Model Y production site is continuing at an incredibly rapid pace. Preparations seem to be underway to construct even more buildings in the Gigafactory 3 complex. This was highlighted in footage recently taken of the site, which depicted multiple cranes and pile drivers operating south of the general assembly building. 

Neither Tesla nor local Chinese news outlets have shared details about the nature of the site’s upcoming buildouts, though statements from workers have indicated that construction activities in the overall complex have entered their second phase. The actual plans for Gigafactory 3’s Phase 2 construction are yet to be announced, though speculations from the EV community suggest that the upcoming buildings could be allotted for the production of electric car drivetrains and battery packs, similar to Gigafactory 1’s activities in Nevada. 

Gigafactory 3 is just as important to Tesla as it is for China. The facility stands to benefit the electric car maker as it would open the doors to China’s greater EV market, which has so far been dominated by local carmakers that roll out affordable electric cars. On the other hand, Gigafactory 3 is also an important structure for China, as the facility stands as a strong symbol for the country’s dedication to embracing sustainable transportation. China has aggressive electrification goals, after all, and there are few better ways to emphasize this than to host the auto industry’s most notable EV maker in its shores.

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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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Investor's Corner

SpaceX stock gets a slew of price target boosts after bullish earnings call

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Wall Street analysts rapidly raised price targets on SpaceX (NASDAQ: SPCX) after the company reported a bullish third quarter for 2026 following the market close on October 20. Shares were sent sharply higher in after-hours and premarket trading.

SpaceX posted revenue of $14.6 billion, a 161 percent year-over-year increase that comfortably topped consensus estimates, which fell near $12.7 billion. The company also posted a net profit of $4.4 billion from a prior-year loss, with adjusted EBITDA reaching $8.8 billion.

Its Super Intelligence (AI) division generated roughly $7.6 billion and became the largest revenue contributor, growing nearly 830 percent year-over-year, while the Connectivity segment delivered $5.2 billion on strong subscriber additions that lifted the consumer base to 13.6 million for Starlink.

The Earnings Call proved especially catalytic, as CEO Elon Musk and CFO Bret Johnsen outlined Q1 2027 revenue guidance of $33 billion to $37 billion, which was far above the roughly $22 billion analysts had modeled, alongside fourth-quarter capital-expenditure plans of $35 billion to $40 billion focused on AI compute infrastructure at sites including Memphis and Southaven.

SpaceX delivers blockbuster Q3 results as Super Intelligence segment booms

Management targets 2.5 to 3 gigawatts of nameplate compute capacity by year-end and discussed pathways to 13 gigawatts or more by the end of 2027. Musk described relentless demand from hyperscalers and other customers, with compute pricing supporting payback periods of less than a year and potentially as short as six months.

Additional highlights included Starship’s recent orbital success and V3 satellite deployment, Starlink pricing and enterprise momentum, rapid Grok Bot adoption, spectrum expansion plans, and the formation of special committees to explore a possible combination with Tesla.

These elements prompted a wave of price-target increases:

  • JPMorgan more than doubled its target to $500 from $240 while maintaining an Overweight rating.
  • Cantor Fitzgerald lifted its target to $345 from $246 (Overweight).
  • Barclays raised its target to $300 from $254 (Overweight).
  • Citi increased its target to $240 from $200 (Buy),
  • UBS moved to $230 from $210 (Buy), and
  • TD Cowen raised its target to $224 from $200 (Buy).
  • Morgan Stanley held an Overweight rating with a $300 target.
  • Other firms also adjusted higher, including Wells Fargo (to $274 from $214) and Clear Street (to $248 from $217). Analysts broadly cited the strong quarterly print, accelerating AI compute expansion, Starlink progress, and Starship milestones as drivers of higher long-term growth and earnings power.

Shares, which closed at $147.79 on October 20, jumped roughly 8 percent in early premarket trading on October 21 as investors digested the results and the newly elevated Street targets.

The average analyst price target has moved higher, which reflects greater conviction in SpaceX’s trajectory across launch, connectivity, and the Super Intelligence business, even as elevated spending remains a point of focus.

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Elon Musk

SpaceX showcases exactly how it plans to catch Starship next month

SpaceX played a new Starship Flight 15 simulation showing the ship caught by tower chopsticks.

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Concept video of SpaceX’s Flight 15 Starship held in the launch tower’s chopstick arms after a catch. (Credit: SpaceX)
Concept video of SpaceX’s Flight 15 Starship held in the launch tower’s chopstick arms after a catch. (Credit: SpaceX)

SpaceX gave its clearest look yet at how it plans to catch a Starship upper stage, playing a roughly 80 second animation of the maneuver during its third quarter earnings webcast on Tuesday. The clip ran under an “Up Next: Ship Catch” banner moments after Elon Musk confirmed that Flight 15, expected next month, will try to catch both the Super Heavy booster and the ship with the launch tower.

The animation opens at ground level, looking up through the launch mount at a tower with its chopstick arms spread wide. It then cuts to the ship gliding back through the atmosphere in its horizontal belly flop position, with its forward and aft flaps steering the descent. A wide shot from the Starbase shoreline follows, where the ship is a small dot in the sky before it swings vertical and drops toward the launch towers. The final shots show the ship sliding down past the top of the tower, a close view of the hardware along its side meeting the arms, and the vehicle hanging in the chopsticks.

 

Musk called the catch the step that closes Starship’s reuse loop. “If we succeed, it will be the first time that an orbital launch vehicle has been fully recovered,” he said. He put the odds of success on the first attempt at “more likely than not,” and said SpaceX has “a steady stream of Starship flight attempts through the end of this year” if Flight 15 falls short.

The sequence mirrors work SpaceX has already done with real hardware. In September, Ship 42, the vehicle assigned to Flight 15, was lifted by the Pad 2 chopsticks into a simulated catch position, where crews cycled the arms and connected the ship quick disconnect arm while it hung from the tower. NASASpaceflight has since reported that SpaceX removed Ship 42’s engines before its static fire and sent it back for another cryogenic test.

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Gwynne Shotwell covered the regulatory side on the same call. After what she called “significant constructive engagement with the FAA,” SpaceX expects the Flight 15 license “to include return to launch site and tower catch for both stages.” Bringing the ship home means reentering toward land instead of the open ocean, which Musk said in February would only happen once the chance of the ship breaking up over land was very low, after two perfect soft landings at sea.

SpaceX has caught Super Heavy with the tower three times, on Flights 5, 7 and 8, but the ship returns from orbit at far higher speed and has never been caught. Flight 14 on September 28 was the first Starship to reach orbit, and it deployed 26 Starlink V3 satellites before splashing down, a mission SpaceX counted as its first revenue flight in the Q3 results it reported Tuesday.

The timing lines up with what Musk told the crowd at Giga Texas earlier this month, when he said Flight 15 would probably launch a little before Thanksgiving and that Flight 16 could refly both stages. On Tuesday’s call he went further, saying Starship should fly weekly at some point in the first half of 2027 and twice weekly or more by the end of next year as SpaceX works toward landing a rocket and launching it again with no refurbishment.

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Elon Musk just confirmed the Tesla and SpaceX merger step everyone was waiting for

Tesla and SpaceX formed special committees to weigh a merger, and Elon Musk supports it.

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Elon Musk confirmed Tuesday that Tesla and SpaceX have each formed special committees of independent directors to study a possible merger, the first formal step toward combining the two companies after months of speculation.

Musk made the disclosure during SpaceX’s third quarter earnings call. “Both SpaceX and Tesla have formed special committees to discuss this idea at the request of shareholders,” he said. “Because I’m a conflicted party, I can’t actually be in the discussions of the special committees.” He described the setup as “an odd kabuki dance where two groups of people are talking and I can’t be in the conversation.”

Musk did not hide where he stands. “Do I think it would be a good idea? Yes,” he said, pointing to shared work on super intelligence software, chip design, the Terafab facility in Austin, robotics, mass to orbit and connectivity. “I do think there’s a lot of merit to combining the companies as we are pretty much in the super intelligence singularity.”

He also tried to cool expectations. The committees have not agreed on terms for any transaction, and Musk said assuming a merger is a certainty “would be overstating it.” Any deal would go to shareholders, and on the Tesla side it would need approval from 50 percent of all outstanding shares, not just the shares that are voted. Musk called that “quite a high hurdle.”

That bar has tripped Tesla up before. The company’s 2025 attempt to declassify its board won support from only 39.4 percent of outstanding shares and failed. Musk’s own voting stake sits near 20 percent after he exercised his 2018 options in June, so a deal would need broad backing from institutions and a retail base that often leaves votes uncast.

Timing is another open question. Tesla filed its proxy statement Monday for its December 3 annual meeting, and the ballot has only three items: director elections for Musk, Robyn Denholm and JB Straubel, a say on pay vote and auditor ratification. Barclays analyst Dan Levy had argued that an announcement would need to land by late October or early November to make the annual meeting, as Teslarati noted in its SpaceX earnings preview. With no terms agreed, any vote would likely require its own special meeting.

Elon Musk gives his most telling Tesla-SpaceX merger conversation yet

Musk has been edging toward this for weeks. At the All-In Summit in September, he asked “who can imagine what action one might take when there’s so much close collaboration,” Teslarati reported. Last week’s Roadster unveil, built around SpaceX derived cold gas thrusters, pushed the talk further. The two companies already share the Terafab chip project, and Tesla holds a small SpaceX stake that came from its earlier investment in xAI.

SpaceX brought strong numbers to the conversation. It reported Q3 revenue of $14.58 billion, up 161 percent year over year, with its Super Intelligence segment now its largest at $7.56 billion. A higher SpaceX valuation would shape any exchange ratio Tesla holders are offered.

Tesla reports its own third quarter results after the close on Wednesday, October 21. Investors had already ranked merger timing among the top retail questions for SpaceX’s call, and the committees will almost certainly come up again on Tesla’s.

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