Inside Tesla's $5 billion Gigafactory

Tesla is by far one of the most successful companies in modern history. They popularized fully electric cars and created a massive demand among the public. With a market cap of around $380 billion, Tesla is growing by the day. But to keep up with orders, Tesla built a futuristic facility called the Gigafactory. Today, we're taking a look inside the Tesla Gigafactory. Tesla currently produces about 350,000 cars a year, far fewer than the public demands. But they have ambitions to ramp up production to more than 20 million cars a year. This bold strategy will require numerous advances in their current chain of production, including several larger factories, which are currently being built all over the world. But the bedrock of Tesla's production line is their Gigafactory in Sparks, Nevada. The company's first fully built factory will serve as the model for what eventually could be a dozen massive Tesla factories. Tesla, meanwhile, said US orders for the Model 3 had outpaced its available output for the past two years. The Gigafactory, which is open around the clock, currently has 7000 employees. The Gigafactory cranks out approximately two battery packs every minute. Its production is currently estimated to be 5000 a week with room to grow according to Sam Jaffe, managing director with Cairn Energy Research Advisors in Boulder, Colorado. Tesla's project Roadrunner aims to reduce costs to $100 per kilowatt hour by 2021. Tesla has shown an ability and a drive to reduce both cell costs and battery pack costs, he said. They have been planning for this moment with this tremendous cost advantage for a long time, and in general, they have executed well on it. That's not to say there haven't been growing pains at the Gigafactory. Tesla initially partnered with Panasonic to produce its proprietary batteries. Panasonic claimed they could increase energy density within Tesla's batteries. And after years of allegedly fraught relationships between the two companies, they recently inked another deal that is due to last until 2023. Panasonic is not Tesla's exclusive battery supplier anymore, since they began partnerships with LG Chem and CATL to supply cells in China. Working alongside the factory's 7000 human employees are a team of super smart robots. Some of the robots navigate through the factory using digital maps. An employee expanded on that saying they're really on a fixed path. So it's very predictable. They're going to the same locations, picking up from one location and emptying off at another location. And what it allows us to really do is to have things moving from inventory to line side all day long without a whole lot of human intervention at all. Gigafactory one is aligned on true north, which was done so that the equipment can be mapped by GPS and solar panels on the roof can be accurately aligned. The factory has also been designed to become entirely energy self reliant. Tesla intends to power the structure through a combination of onsite solar, wind and geothermal sources. When completed, the building will have the largest footprint in the world and the second largest volume. Though Tesla has faced scrutiny for wastefulness within the factory, its master plan includes many energy saving features. For example, excess heat from equipment such as compressors and high temperature ovens will be able to not only run equipment efficiently, but to help keep the factory warm in the colder months. Tesla's Gigafactory also has a water cooling system that repels extremely low temperatures. Because of the way the air is here in Nevada. It's dry and really hot during the day, but it's very cool at night. We do have a 10 million gallon water tank out back and it allows that water to cool down. We use it for air conditioning. A lot of the equipment requires chilled water to operate to keep it running, said Lauren Cito, a Tesla employee. Tesla's Vice President of Operations Chris Lister also spoke in the video, we really wanted to get to a point where this is going to become a fully net zero facility, leaving zero carbon footprint, creating products that also leave zero carbon footprint. Nevertheless, Giga Nevada has turned a profit for the first time in For Panasonic, this means that their investment of $1.6 billion in the Nevada plant is finally yielding returns roughly 3.5 years after entering full production. When construction began in 2015, it appeared that Tesla was risking everything on the Gigafactory one, it would churn out the batteries necessary for the Tesla Model three, which is the car that was supposed to make or break the company, and for which Tesla already had hundreds of 1000s of orders despite first deliveries still being more than a year away. At this point, production had already started in the form of Tesla powerwalls and power packs, which are meant for stationary energy storage for a home or a business. A powerwall is a bit like an enormous battery hanging out on your wall for whenever you need it for power outages, or even just smoothing out energy consumption. One power pack in turn is 16 powerwall batteries in a stack, and the energy stored inside can power a typical American home for three days, Tesla says. At least five states competed to attract Gigafactory by offering tax incentives, cash grants and other methods in the hope of future business. California, Arizona, Nevada, New Mexico and Texas where San Antonio had offered bigger incentives with no sales tax but did not get the factory. States without sales tax were topping the list of preferred sites. Nevada estimates a tax base of $1.9 billion over 20 years. After sticky negotiations, Tesla chose the Tahoe Reno Industrial Center or TRC as the location of the Gigafactory mainly due to speed and a state of Nevada incentive package. Other location reasons were rail access, direct salability and low air humidity to ensure less than 300 parts per million humidity in production. The TRC owners gave the first 1000 acres to Tesla for free. And of course the factory is not without controversy. In August 2018, Carl Hansen, a former member of the company's security team filed a whistleblower complaint with the Securities and Exchange Commission. In the complaint, he alleges that Tesla suppressed an internal investigation into various criminal activities that occurred at Giga Nevada during his tenure. For one, Hansen alleges that the company refused to inform the DEA and local law enforcement officials about evidence of cocaine and crystal meth smuggling occurring on factory grounds in connection with the Mexican drug cartel. Hansen also claims in it that the company successfully suppressed his of raw materials. Following the complaint, Hansen went on to allege that Tesla fired him as an employee and then as a contractor because he was not a Tesla team player. Hansen then cooperated with an FBI investigation after discovering that Tesla was spying on him and a roommate immediately following his expulsion. The investigation was later shut down without explanation following months of work. Hansen detailed his entire story in a three hour long interview. Always one for dramatic announcements, Tesla's controversial CEO Elon Musk declared that he planned to build around 100 gigafactories in the coming years. While that number is nowhere close to reality at the moment, there are several gigafactories being built around the globe. The first is Giga2 in Buffalo, New York. Tesla's Giga New York was not originally a facility of the electric carmaker. Instead, it was a factory of SolarCity before the company was acquired by Tesla. Giga New York was intended to be a facility for Tesla Energy, producing the company's flagship residential energy product, the solar roof, among others. Tesla received benefits for Giga New York to the tune of more than $950 million. Meanwhile, Tesla's $2 billion gigafactory in Shanghai, or Gigafactory 3, which broke ground this year, is expected to produce Tesla's Model 3 using a complete vehicle production line before the end of the year. A spokesman said Tesla is using what it's learned from its Nevada facility toward its upcoming China factory and hoping to use the So many people have invested so much of their lives into making this successful. It really is a competitive advantage, but it is also so important in accelerating the advent of sustainable transport, he said. To help satiate the European market, Tesla is building another factory outside of Berlin, also known as Gigafactory 4. In a recent interview, Musk implied that the Berlin location would not make cars like the rest of the factories. Elon Musk promised the local made Model Y would be a radical redesign of the core technology of building a car. Musk also spoke in the interview about why the construction is going so fast to speed up environmental changes, how it is going so swiftly with prefabrication techniques, and how well located Giga Berlin will be. However, Tesla is distinctly unwelcome to many Berliners who spurned a Google campus several years ago. Protests have begun and many people want the There are a total of 406 objections that have been raised about Gigafactory Berlin, with the most controversial ones being related to Tesla's water use, tree clearing activities and the use of piles in its construction process. Tesla has responded to some of these criticisms by reducing its planned water consumption and using fewer piles on its build outside. The opposition is also upset about the fact that Tesla had carried on with Giga Berlin's construction even before final permits were Finally, the Giga five is being built just outside of Austin, Texas. The construction of Gigafactory Texas is a massive product with up to 5 million square feet plant and numerous construction jobs poised to be filled. It remains unclear if a general contractor had been hired for the construction of its cyber truck and semi facility, though last month, several contractors have expressed their interest in the high profile project. That being said, reports have hinted that Tesla may be pondering the idea of working Needless to say, Tesla is growing extremely quickly, and its fleet of Gigafactories will serve as the backbone of the company in years to come.