Tesla Gigafactory

Tesla’s Expansion From Beijing to Berlin

Tesla, Inc., an American automotive company, takes another step toward global business expansion. Founded in July 2003, Tesla had been operating from the two domestic-based production units of Reno, Nevada, and Fremont, California in the US till 2019.

However, the establishment of overseas manufacturing units came into being after the Chinese government signed an agreement with Tesla in 2018.

The agreement allowed the company to set up the manufacturing unit called ‘Tesla Gigafactory 3’ in Shanghai in October 2018 which is expected to start functioning by the end of 2019.

Now, Tesla is planning to start the next overseas expansion ‘Gigafactory 4’ in Berlin, with an aim to foster a ‘Gigafactory Europe’ in the coming years.

Tesla’s Worth and Its Market Strategy

Tesla, which is currently worth nearly $ 24 billion, aims at mass-producing environment-friendly cars across the globe. Gigafactory 3 plans to produce 17,400 ‘Model 3’ electric cars by the end of 2019 leveraging the strong manpower of Chinese workers.

Tesla is likely to pursue its global expansion in other regions in line with its dynamic approach, especially the company’s environmental conscious strategies.

Berlin’s Gigafactory 4 is a 300-hectare reserve forest land, which was once proposed by BMW for the purpose of setting its production units. BMW’s plan was rejected considering the environmental issues related to the removing of the dense forest covering this plot of land.

Elon Musk, the CEO of Tesla, donated $ 1 million to a YouTube project for re-plantation 1 million trees elsewhere, thus acquiring the land. Moreover, Tesla’s cars are electrical, which are not likely to bring any negative impact on the environment.

Challenges in the Overseas Expansion

Tesla plans to gain access to the Chinese and European markets to attract a wide range of customers. Presently, China, besides Germany, is one of the largest markets on the planet.

However, Tesla’s expansion policies and goals, especially in China, need extra favor from the Chinese Government, as it has not yet permitted the Gigafactory 3 to initiate the production on such a large scale.

Nonetheless, it is too early to pass judgment, as Tesla’s overseas companies are yet to be up and functioning, specifically the company in Berlin, which will not be operational till 2021.

Sources:

  1. https://in.mashable.com/tech/8456/elon-musk-says-new-tesla-gigafactory-will-be-built-in-berlin
  2. https://www.teslarati.com/tesla-gigafactory-3-17k-model-3-production-2019-report/
  3. https://electrek.co/2019/11/14/tesla-cut-down-forrest-build-gigafactory-4-elon-musk-plant-1-million-trees/

I’m Roshan, a journalist, blogger and music lover. I like covering global news related to finance, business, and technology. Focusing on the collection of true and reliable information, I rely on working by conducting interviews with business leaders and talking to the inside sources of companies.

You can reach out to me at: [email protected]

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