Tesla Motors multiple simultaneous paths to launching the Tesla Gigafactory

Time is ticking on the Tesla Gigafactory project, so let’s try to catch up with the latest on that project, and does the new facility in Lathrop CA play a role with the Gigafactory?  The Gigafactory is an item Elon Musk began discussing publicly in the Fall of 2013 and is meant to supply enough batteries to Tesla Motors for manufacturing a half million electric cars per year by 2020.  If you pencil out the numbers, that’s 35-50 gigawatt hours per year of battery manufacturing capacity required, just for Tesla’s projected needs, and 2013’s world production was about 34 gigawatt-hours.

Reinventing the worlds transportation system is not a simple task, eh?

Last week news surfaced that Tesla Motors is building a new manufacturing site, in Lathrop, CA.  The building currently on that site is about 400,000 sq feet, and according to the real estate agent it can be expanded to about 550,000 sq feet.  The jobs Tesla is listing at that facility are for CNC operators, training, and supervisors.  While that’s a sizable facility it’s nowhere near the size required for the Gigafactory.  So while Tesla is being tight-lipped about what, specifically, the Lathrop factory will do, it’s not suitable for anything other than a small role in the required battery pack manufacturing capacity.

An article from watchdog.org reprinted by NewsMax talks about the political competition between California, New Mexico, and Nevada to win the Gigafactory.  Politico’s in California are leaning on Tesla to get them to choose a California location, and are throwing large subsidies in Tesla’s direction.  New Mexico has offered thousands of square acres of land for the factory.  Nevada has an interesting advantage over Arizona or New Mexico.  The Fremont factory is directly next to rail lines, that head directly to northern Nevada, and from there across the I-80 corridor across the country.  It means stuff manufactured in Northern Nevada can easily reach the Fremont factory by rail at less cost than from other states to the south.  The last note is that Nevada, Arizona and Texas are right-to-work states where California is not.

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A Bloomberg News report quotes Elon Musk saying Tesla will probably keep working with at least two states all the way to ground-breaking ceremonies, just to ensure the overall project doesn’t run into delays.  That is, suppose they decided today the New Mexico offer was the best, told all the others to take a hike, and then the New Mexico deal fell through.  They’d then have to come back to the other states and repair relationships before being able to make headway elsewhere.  Tesla raised $2.3 billion in convertible notes in March 2014 to fund the Gigafactory.  Tesla chose to not build the Gigafactory in California because of how long it takes to get environmental approvals here.

This report got picked up by lots of other “reporters” who are posting articles claiming Tesla will probably build two Gigafactories.  There’s a nuance in what Musk said that I think is going over the head of some of the reporters.  What he said is Tesla is moving forward with two (or more) proposals simultaneously, and will take at least two of them all the way to the ground-breaking phase before making a final selection.  That doesn’t mean they’re building two factories.  it means they’re hedging their bets to ensure the factory gets constructed in time.

Could Tesla choose a location in California’s Salton Valley because of lithium resources there?  That’s the claim by Carl Stills, who notes that Lithium is being recovered from brines in that area, making the location a potential win for Tesla Motors.  The lithium extraction is being done by Simbol Materials, headquartered in Pleasanton CA, at the Featherstone geothermal plant in Calipatria.

According to GreenTech Media, Texas, New Mexico, Arizona and Nevada are all bidding with different incentive packages.  One item Texas is considering is revamping “antiquated” dealership laws in order to allow Tesla to conduct direct car sales.  Northern Nevada is mentioned as a front-runner, again because of the rail lines.

 

About David Herron

David Herron is a writer and software engineer living in Silicon Valley. He primarily writes about electric vehicles, clean energy systems, climate change, peak oil and related issues. When not writing he indulges in software projects and is sometimes employed as a software engineer. David has written for sites like PlugInCars and TorqueNews, and worked for companies like Sun Microsystems and Yahoo.

About David Herron

David Herron is a writer and software engineer living in Silicon Valley. He primarily writes about electric vehicles, clean energy systems, climate change, peak oil and related issues. When not writing he indulges in software projects and is sometimes employed as a software engineer. David has written for sites like PlugInCars and TorqueNews, and worked for companies like Sun Microsystems and Yahoo.

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