Where Is Elon Musk Going Put His Next Gigafactory?

tesla motorsWhat Gigafactory 2’s Placement Means for Tesla

Tesla Motors Inc (NASDAQ:TSLA) and Elon Musk announced plans to build the next “Gigafactory” somewhere in Europe, the same day they’ve laid out plans to acquire Grohmann Engineering GmbH to help build on their automated factories.

While coverage about the Grohmann deal can be found in our previous article on the subject, let’s focus on what the “Gigafactory 2” will bring to Tesla.

First, it will help Tesla keep up with its lofty production goals. With plans to more than sextuple its production numbers by 2018, Tesla will need the extra resources to help put together what it hopes will be a hot-selling “Model 3,” which will hit markets in 2017.

“Combined with our California and Michigan engineering facilities, as well as other locations to follow, we believe the result will yield exponential improvements in the speed and quality of production, while substantially reducing the capital expenditures required per vehicle,” Tesla writes. (Source: “Tesla plans to choose location for ‘Gigafactory 2’ in Europe next year, will produce both batteries and cars,” Electrek, November 8, 2016.)

Tesla wants both “Gigafactory 1” and its new-born sibling to help hit these lofty production goals of shipping 500,000 models a year. But where Gigafactory 2 will differ from its predecessor is its ability to not just assemble batteries, but also the Tesla vehicles themselves. Currently, Gigafactory 1 constructs only lithium-ion batteries, but is also planning on integrating drive system production lines at the the facility.

As said in statement, Tesla plans for this factory to not only aid in production, but become a “machine that builds the machine.” The factory itself is deserving of equal if not “magnitudes more attention in engineering than what they produce.”

The statement went on to say that the “factory becomes more of a product than the product itself” at sufficient production volumes. (Source: “Formation of Tesla Advanced Automation Germany,” Tesla Motors Inc, November 8, 2016.)

Ultimately, what we have here is another layer of Tesla’s and Elon Musk’s vision. As with all things Musk, his ambition is never limited to the obvious, but usually involves grander schemes and machinations. Whether it’s landing a person on Mars with “SpaceX” or trying to change the world with non-fossil fuel sources of energy, Gigafactory 2 represents another attempt at innovation by the world’s most famous entrepreneur.