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VW’s largest plant to get EV makeover, setting up showdown with Tesla’s Giga Berlin

Credit: Volkswagen

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Volkswagen’s Wolfsburg, Germany production facility is being upgraded to make room for electric vehicle production, setting up a showdown with Giga Berlin in an epic battle of massive EV production facilities in Germany.

An internal video conference with various VW team members and CEO Herbert Diess revealed the German automotive powerhouse would being planning for its largest facility to begin producing electric vehicles in a substantial push to create EVs under the Volkswagen name. The Wolfsburg facility is the world’s largest automotive factory. Volkswagen creates 800,000 vehicles a year at the facility, with the popular Golf and Tiguan models being the main products at the plant.

Volkswagen, however, has new plans for Wolfsburg, and it requires an overhaul of the existing facility to make way for EV powertrains to be manufactured. Diess said during a video conference on Monday that Wolfsburg will be fitted with the latest EV technology and software operations, according to people who were tuned in that work for Volkswagen. These sources wished to remain anonymous as the meeting wasn’t open to the public, Bloomberg initially reported.

Diess’ plans to upgrade Wolfsburg aren’t a guessing game by any means. Volkswagen is planning to draw inspiration from Tesla, the leader in electric vehicle manufacturing and technology, in an attempt to recreate the efficient production processes that the California-based company has used to ramp its production efforts to 500,000 cars a year. Tesla is able to build an EV in around 10 hours, less than half the amount of time that it takes Volkswagen to build one of its cars.

The comparison with Tesla is nothing new for Volkswagen. The company has used Tesla as a guideline to measure its success and efforts in its push toward electrification numerous times. In the past, Volkswagen has mentioned Tesla’s lead in software, and the company’s domination in the sector has compelled Diess to establish a strong relationship with CEO Elon Musk. The two have often traded compliments with one another and have even given one another test drives in upcoming models.

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But, for now, the two companies remain competitors in the sector, and Volkswagen’s large-scale efforts are not being taken lightly. The upgrades to the Wolfsburg facility set up a major showdown with Tesla’s Giga Berlin factory, which is set to begin producing vehicles next Summer. Giga Berlin is set to be a state-of-the-art facility that will introduce new technologies and manufacturing techniques for Tesla. Set up to be a marvel of vehicle technology and engineering, Musk plans to use new-age manufacturing techniques, like casting machines and a battery production line to increase annual output to keep up with increasing demand.

Europe, being a significant market for EVs due to their overwhelming popularity and alignment with upcoming climate change targets, could be the path to success for either company. While Tesla is already widely regarded as the leader in EV manufacturing, Volkswagen could be considered the #2 company simply because of its commitment to transitioning away from petrol-powered engines.

With Diess set to remain at Volkswagen’s helm until at least April 2023, he has the board’s support moving forward. The next step is getting the facilities it has in place updated to support EV manufacturing. With several of these plants already building the ID.3 and ID.4, the name of the game is ramping production to massive volumes.

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 AI5 chip nears completion, Elon Musk teases 9-month development cadence

The Tesla CEO shared his recent insights in a post on social media platform X.

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Credit: Tesla

Tesla’s next-generation AI5 chip is nearly complete, and work on its successor is already underway, as per a recent update from Elon Musk. 

The Tesla CEO shared his recent insights in a post on social media platform X.

Musk details AI chip roadmap

In his post, Elon Musk stated that Tesla’s AI5 chip design is “almost done,” while AI6 has already entered early development. Musk added that Tesla plans to continue iterating rapidly, with AI7, AI8, AI9, and future generations targeting a nine-month design cycle. 

He also noted that Tesla’s in-house chips could become the highest-volume AI processors in the world. Musk framed his update as a recruiting message, encouraging engineers to join Tesla’s AI and chip development teams.

Tesla community member Herbert Ong highlighted the strategic importance of the timeline, noting that faster chip cycles enable quicker learning, faster iteration, and a compounding advantage in AI and autonomy that becomes increasingly difficult for competitors to close.

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AI5 manufacturing takes shape

Musk’s comments align with earlier reporting on AI5’s production plans. In December, it was reported that Samsung is preparing to manufacture Tesla’s AI5 chip, accelerating hiring for experienced engineers to support U.S. production and address complex foundry challenges.

Samsung is one of two suppliers selected for AI5, alongside TSMC. The companies are expected to produce different versions of the AI5 chip, with TSMC reportedly using a 3nm process and Samsung using a 2nm process.

Musk has previously stated that while different foundries translate chip designs into physical silicon in different ways, the goal is for both versions of the Tesla AI5 chip to operate identically. AI5 will succeed Tesla’s current AI4 hardware, formerly known as Hardware 4, and is expected to support the company’s Full Self-Driving system as well as other AI-driven efforts, including Optimus.

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Tesla Model Y and Model 3 named safest vehicles tested by ANCAP in 2025

According to ANCAP in a press release, the Tesla Model Y achieved the highest overall weighted score of any vehicle assessed in 2025.

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Credit: ANCAP

The Tesla Model Y recorded the highest overall safety score of any vehicle tested by ANCAP in 2025. The Tesla Model 3 also delivered strong results, reinforcing the automaker’s safety leadership in Australia and New Zealand.

According to ANCAP in a press release, the Tesla Model Y achieved the highest overall weighted score of any vehicle assessed in 2025. ANCAP’s 2025 tests evaluated vehicles across four key pillars: Adult Occupant Protection, Child Occupant Protection, Vulnerable Road User Protection, and Safety Assist technologies.

The Model Y posted consistently strong results in all four categories, distinguishing itself through a system-based safety approach that combines structural crash protection with advanced driver-assistance features such as autonomous emergency braking, lane support, and driver monitoring. 

This marked the second time the Model Y has topped ANCAP’s annual safety rankings. The Model Y’s previous version was also ANCAP’s top performer in 2022.

The Tesla Model 3 also delivered a strong performance in ANCAP’s 2025 tests, contributing to Tesla’s broader safety presence across segments. Similar to the Model Y, the Model 3 also earned impressive scores across the ANCAP’s four pillars. This made the vehicle the top performer in the Medium Car category.  

ANCAP Chief Executive Officer Carla Hoorweg stated that the results highlight a growing industry shift toward integrated safety design, with improvements in technologies such as autonomous emergency braking and lane support translating into meaningful real-world protection.

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“ANCAP’s testing continues to reinforce a clear message: the safest vehicles are those designed with safety as a system, not a checklist. The top performers this year delivered consistent results across physical crash protection, crash avoidance and vulnerable road user safety, rather than relying on strength in a single area.

“We are also seeing increasing alignment between ANCAP’s test requirements and the safety technologies that genuinely matter on Australian and New Zealand roads. Improvements in autonomous emergency braking, lane support, and driver monitoring systems are translating into more robust protection,” Hoorweg said.

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Tesla Sweden uses Megapack battery to bypass unions’ Supercharger blockade

Just before Christmas, Tesla went live with a new charging station in Arlandastad, outside Stockholm, by powering it with a Tesla Megapack battery.

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Credit: Tesla Charging/X

Tesla Sweden has successfully launched a new Supercharger station despite an ongoing blockade by Swedish unions, using on-site Megapack batteries instead of traditional grid connections. The workaround has allowed the Supercharger to operate without direct access to Sweden’s electricity network, which has been effectively frozen by labor action.

Tesla has experienced notable challenges connecting its new charging stations to Sweden’s power grid due to industrial action led by Seko, a major Swedish trade union, which has blocked all new electrical connections for new Superchargers. On paper, this made the opening of new Supercharger sites almost impossible.

Despite the blockade, Tesla has continued to bring stations online. In Malmö and Södertälje, new Supercharger locations opened after grid operators E.ON and Telge Nät activated the sites. The operators later stated that the connections had been made in error. 

More recently, however, Tesla adopted a different strategy altogether. Just before Christmas, Tesla went live with a new charging station in Arlandastad, outside Stockholm, by powering it with a Tesla Megapack battery, as noted in a Dagens Arbete (DA) report. 

Because the Supercharger station does not rely on a permanent grid connection, Tesla was able to bypass the blocked application process, as noted by Swedish car journalist and YouTuber Peter Esse. He noted that the Arlandastad Supercharger is likely dependent on nearby companies to recharge the batteries, likely through private arrangements.

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Eight new charging stalls have been launched in the Arlandastad site so far, which is a fraction of the originally planned 40 chargers for the location. Still, the fact that Tesla Sweden was able to work around the unions’ efforts once more is impressive, especially since Superchargers are used even by non-Tesla EVs.

Esse noted that Tesla’s Megapack workaround is not as easily replicated in other locations. Arlandastad is unique because neighboring operators already have access to grid power, making it possible for Tesla to source electricity indirectly. Still, Esse noted that the unions’ blockades have not affected sales as much.

“Many want Tesla to lose sales due to the union blockades. But you have to remember that sales are falling from 2024, when Tesla sold a record number of cars in Sweden. That year, the unions also had blockades against Tesla. So for Tesla as a charging operator, it is devastating. But for Tesla as a car company, it does not matter in terms of sales volumes. People charge their cars where there is an opportunity, usually at home,” Esse noted. 

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