Tesla Built A $5 Billion Factory, Here’s Why

Elon Musk has passionately thrown himself into the inner workings of all aspects of Tesla, and is known for his extensive work hours and laser sharp focus on catapulting technology to the next level. Always ten steps ahead of everyone else, and proving that Tesla stands in a league entirely their own, this giant enterprise has invested $5 billion in a Gigafactory that is dedicated to the production of batteries. The idea is to continue to build Gigafactories and to dominate the market when it comes to the production of the batteries and vehicle components required for the manufacturing of all Tesla vehicles.

The Gigafactory is the highest volume battery plant that the world has ever seen and, of course, that comes with a hefty $5 billion price tag.

Full Control

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Elon Musk didn’t make it to the top of his $176 billion fortune by taking days off. In fact, he drives himself harder than almost anyone else out there. Striving to always be at the top of his industry means Elon Musk wants  full control over everything, all of the time. As the CEO of the leading electric car manufacturer in the world, Musk wants to continue to drive the success of Tesla forward and ensure there’ s no competition biting at the heels of his empire.

The way he wants to achieve this is to maintain control of every aspect of his factories, and that ultimately means Musk doesn’t want to rely on a third party resource for those ever-so-important batteries that Tesla requires.

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Cost Savings & Supply

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Battery electric cars rely heavily on battery supply. Without the ability to meet their own demand for batteries, Tesla will be entirely crippled. This would open up an enormous playing field for all battery manufacturers to set their prices at a premium and become the required source for all of Tesla’s production needs.

Elon Musk won’t be wagered out of his own game, nor will he accept the same fate as Fisker did, not so long ago. Poised to be one of his biggest competitors and funded by one of his former employees, Henrik Fisker, the entire Fisker enterprise went belly-up when they were no longer able to acess the batteries required to power the vehicles they were manufacturing.

Refusing to ever face the kiss of death with supply, and never one to be held financially captive by a supplier, Musk has decided that manufacturing everything for himself is the best way to ensure Tesla’s sustainability. Experts reveal that this $5 billion factory will “reduce the cost per KwH by 30% in the first year of production, with further price reductions as the factory expands.”

Cutting Edge

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Maintaining the position of being the industry leader in the production of electric cars means Tesla has to stay on top of cutting edge technology and manufacturing practices.

The building of the Gigafactory comes with the goal of producing 500,000 cars a year, and  essentially makes Tesla their own contractor. They now solely produce and manufacture their own supply.

Tesla will be pre fabricating the construction of this factory to speed up the process, and keep costs under control. This allows Tesla to design every aspect of their factory as well, and they’re optimizing every square inch to ensure the highest levels of productivity is attained in every step of the production process.

High tech machines will speed up all levels of production, and human counterparts will work to ensure the operation of the factory is monitored and flows efficiently at all times.

Each Tesla EV has thousands of lithium-ion batteries connected inside its battery packs. The new factory, dubbed the Gigafactory will require 10 million square feet of space to produce all the batteries required, which plays a huge role in the massive price tag to purchase and build this factory, but results in massive long-term cost savings when it comes to the execution of production and manufacturing.

Sustainable Energy

According to Tesla, the environmental output of battery cells will significantly decline thanks to the Gigafactory, and “innovative manufacturing, reduction of waste, and the simple optimization of locating most manufacturing processes under one roof,” will keep them at the top of the electric car market, while reducing their overall carbon footprint.

The Gigafactory shatters records when it comes to the measurement of power both used, and saved. Tesla declares that the Gigafactory will be “entirely powered by renewable energy sources. Designed to be a net zero energy factory upon completion, the facility will be primarily powered by solar, and installation.”

Sources: Tesla, Sauder, YouTube

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