Tesla Gigafactory Investor Thread

[Newb]

Panasonic's investment in the Gigafactory must be equally close to half of the total investment for the Gigafactory too, one could think, right?

If I remember correctly, during the call Elon said total GF investment by 2020 will be around 4 billion, Tesla investing around 30-40%, Panasonic around 40% and other investors + state would take the rest.

Did I get that right? So Tesla will have invested around 1.4 billion in GF by 2020?

 

[mrdoubleb]

If I remember correctly, during the call Elon said total GF investment by 2020 will be around 4 billion, Tesla investing around 30-40%, Panasonic around 40% and other investors + state would take the rest.

Did I get that right? So Tesla will have invested around 1.4 billion in GF by 2020?

Something like that.

i am always amazed at the average analyst/writer saying how big of a scam the GF is as Tesla is short 3bn. One would expect people doing business analysis for a living understanding the difference between starting up a plant and reaching full capacity 3 years later.

 

[evme]

Some intersesting stuff, not directly related but it seems a company called Saft is deploying lithium ion battery storage 12MW for Hawaii. And they are using cylindrical NCA cells.

Design News - News - Lithium-Ion Batteries to Provide Grid Support in Hawaii

 

[chickensevil]

If I remember correctly, during the call Elon said total GF investment by 2020 will be around 4 billion, Tesla investing around 30-40%, Panasonic around 40% and other investors + state would take the rest.

Did I get that right? So Tesla will have invested around 1.4 billion in GF by 2020?

Close, it was 4BN to get into production by 2017 and then the rest to go to full production would likely hit 5BN. Percentages are correct though.

- - - Updated - - -

Here are all the relevant notes I took relating to just the factory from the earnings call, hopefully this helps, since a lot of questions being asked were clarified on the call:

Pad is complete for Reno Factory. Going to be doing similar in 1 or 2 other states. Makes sense to have multiple things in parallel. Before moving on, want to make sure things at state level are there that makes sense. Not going for a deal that is unfair to the state or unfair to Tesla. At this point the ball is in the court of NV legislature and governor.

Asking about the 5BN number and on track for suppliers to invest the remainder: 4-5 is pretty accurate up through 2020. 4bn will be pretty close before they get to high volume, as they improve up through 2020 it will likely total 5bn. Tesla will provide 40-50% of the total cost. Panasonic about 20-40%. States 10% and other partners 10,15,20% depending on how vertical they go with the factory. Panasonic was never in doubt to Elon. Actions are what matters, and Panasonic has always taken the actions of an excellent partner. Feel confident hitting the output they need to and the investments they need.

100k exit rate in 2015 and constraint before factory comes online: They see a path to 150-200k cars without the battery factory can't go higher than that without.

Is chemistry going to be the same for batteries? There are improvements to the chemistry and cell improvement. Will see energy density improvement and cost reduction. Seeing 10-15% improvements on the density itself and will be changing the cell shape and size to find the most optimal. Not a lot different from now but 10% more diameter and 10% more height, 30% more energy per cell because of size. Fundamentals of chemistry defines primary costs shape and size don't matter. Chemistry will continue to change to improve.

More on Batteries: "I would be disappointed if it took us 10 years to hit 100$ per kwh pack". Do you think it will then be cost comparable to ICE? "Yes". 30% is not just due to logistics. It is not even the biggest. Designing custom equipment that is much better at processing the equipment makes this work much better rather than some "off the shelf" equipment to build these batteries. Again, they don't need a breakthrough in chemistries. In the long term, there are many interesting things on the horizon. It is hitting a place of no contest with gasoline. They are just pushing it along as fast as they can.

Full notes here: Short-Term TSLA Price Movements - 2014 - Page 594

 

[Robert.Boston]

FWIW -- I had a meeting with a senior official in the California government last week and mentioned the Gigafactory potentially in California. He said "follow the rails, look for a big industrial property." The official exuded the sort of "I know something but can't tell you" confidence that makes me think the odds are very high that the GF will be in California.

 

[uselesslogin]

FWIW -- I had a meeting with a senior official in the California government last week and mentioned the Gigafactory potentially in California. He said "follow the rails, look for a big industrial property." The official exuded the sort of "I know something but can't tell you" confidence that makes me think the odds are very high that the GF will be in California.

I guess that lines up with the Naval Weapons Station speculated in this article:
Calif. still in the running for Tesla | www.ktvu.com

I think if it is there they should build a fully electric locomotive to move the batteries to Fremont. In theory it could be stripping out the diesel tanks and generator and replacing them with batteries. Trains still use electric traction motors so no need to design anything new there. They just need to replace the 3200 horsepower engine and generator which is less than 8 P85s worth of horsepower. Now maybe that is a giant distraction and they shouldn't but it could show the potential for electrifying all transport and at the same time save them transport costs in the long run.

 

[AlMc]

I guess that lines up with the Naval Weapons Station speculated in this article:
Calif. still in the running for Tesla | www.ktvu.com

I think if it is there they should build a fully electric locomotive to move the batteries to Fremont. In theory it could be stripping out the diesel tanks and generator and replacing them with batteries. Trains still use electric traction motors so no need to design anything new there. They just need to replace the 3200 horsepower engine and generator which is less than 8 P85s worth of horsepower. Now maybe that is a giant distraction and they shouldn't but it could show the potential for electrifying all transport and at the same time save them transport costs in the long run.

That would certainly qualify as 'we are not showing all our cards' on TM's part. Think the State of California or Feds for that matter would not be 'helping' in a big way battery powered trains!

 

[Lump]

The biggest problem is that Concord is an EPA Superfund site that needs a lot of clean-up. And Tesla wants a site as soon as possible, which means Concord is likely not in play.

No way Elon is getting involved with the EPA, scratch that location off the list.

 

[daniel Ox9EFD]

It was mentioned that the batteries will be 'next generation', does anyone know what sort of advances are expected? From my understanding of the conversation it is not something revolutionary but relatively evolutionary and conservative. Still NCA or new cathode material?

It would also be interesting to speculate how much of the expected 30+% cost reduction in battery packs is due to new chemistry, vs. use of custom manufacturing equipment which was mentioned as a big one, and logistics.

 

[Jack6591]

FWIW -- I had a meeting with a senior official in the California government last week and mentioned the Gigafactory potentially in California. He said "follow the rails, look for a big industrial property." The official exuded the sort of "I know something but can't tell you" confidence that makes me think the odds are very high that the GF will be in California.

Stockton also has a port. Doesn't Tesla ship cars separately from battery packs to Tilburg. The ability to ship battery packs directly from Stockton to China would be huge.

 

[Papafox]

Looks like we've clearly entered the "bidding war" stage of Gigafactory site selection. Nevada has an attractive site that could receive regulatory approvals very quickly, but I suspect the "by the end of the year" timetable indicates there's much more under consideration than just site and regulatory approval. Tesla is obviously looking at the whole package, and California is very hungry to land the Gigafactory. I think it'll come down to whether Nevada can offer inducements that are on the scale of what we're seeing likely in California. Right now, landing the Gigafactory would be a huge feather in Jerry Brown's cap come Nov. 4, and Nevada needs to understand the competitive environment and sweeten the deal accordingly if state officials wish to prevail.

 

[Newb]

Close, it was 4BN to get into production by 2017 and then the rest to go to full production would likely hit 5BN. Percentages are correct though.

Thanks chickensevil! That means in turn that there's no need for another "big" investor since Tesla and Panasonic aim for about 80-90% of total GF investment.

Now I only hope Nevada bureaucrats will decide wisely and swiftly.

 

[daniel Ox9EFD]

If Tesla is looking for the state to invest 10% of the cost, that's about 400 - 500 million $. Doesn't that make Nevada much less likely to take the GF compared to California or Texas that are more likely to have that kind of money?

 

[techmaven]

I am not sure that the $500 million or so from the state is cash like that. It is likely a bevy of tax breaks, like property taxes, as well as improvements like roads and rail. Things that will be there after the Gigafactory might be shut down some time in the distant future.

 

[RobStark]

The only cash outlays NV will need is for roads,water,sewer, and electrical leading to the front gates of the GF.

That will quickly be repaid by taxes paid by contractors and workers building the GF and working at the GF.

Reno has a population of ~230k. The GF is a really big deal to the local economy.

The rest are tax breaks, or taxes that Tesla will not need to pay for a determined period of time.

 

[mountaineer]

The gig factory will employ more than 6000 people. With a population of ~230 and not much manufacturing industry， I am wondering ｉｆ　ＴＭ will be able to find enough qualified people in a 2-3 years?

Here're the major employers in Reno：
Reno, Nevada - Wikipedia, the free encyclopedia

#	Employer	# of Employees
1	Washoe County School District	8,250
2	University of Nevada, Reno	4,250
3	Washoe County	2,750
4	Renown Regional Medical Center	2,750
5	Peppermill Hotel Casino	2,250
6	International Game Technology	2,250
7	Integrity Staffing Solutions	2,250
8	Silver Legacy Resort Casino	2,250
9	Saint Mary's Regional Medical Center	1,750
10	Atlantis Casino Resort	1,750

- - - Updated - - -

 

[dhanson865]

6,000 people will relocate there no problem. It isn't that hard to get staffing for a major player, offer the right pay / benefits and people will line up for the jobs.

 

[mountaineer]

Elon talked about the >30% cost reduction from the Gig, ｓo anybody what's the current material cost　ｐｅｒ　ＫＷＨ ｆｏｒ　ｔｈｅ　ＮＣＡ　ｂａｔｔｅｒｙ　ｐａｃｋ？

Ｉｎ　ａｄｄｉｔｉｏｎ，　it is forecasted that　ｔｈｅ　ｃｏｓｔ　ｗｉｌｌ　ｂｅ　＄１００　ｐｅｒ　ＫＷＨ　ｏｒ　ｌｏｗｅｒ　ｉｎ　１０　 ｙｅａｒｓ．　Ｃｏｎｃｅｐｔｕａｌｌｙ　ｓｐｅａｋｉｎｇ，　ｄｏ　ｗｅ　ｎｅｅｄ　　ｎｅｗ　ｔｅｃｈｎｏｌｏｇｉｅｓ　ｌｉｋｅ　 Ｍｅｔａｌ－Ａｉｒ，　lithium anode,　ｏｒ　ｏｔｈｅｒｓ　ｔｏ　ａｃｈｉｅｖｅ　ｔｈｉｓ？

 

[blakegallagher]

Elon talked about the >30% cost reduction from the Gig, ｓo anybody what's the current material cost　ｐｅｒ　ＫＷＨ ｆｏｒ　ｔｈｅ　ＮＣＡ　ｂａｔｔｅｒｙ　ｐａｃｋ？

Ｉｎ　ａｄｄｉｔｉｏｎ，　it is forecasted that　ｔｈｅ　ｃｏｓｔ　ｗｉｌｌ　ｂｅ　＄１００　ｐｅｒ　ＫＷＨ　ｏｒ　ｌｏｗｅｒ　ｉｎ　１０　 ｙｅａｒｓ．　Ｃｏｎｃｅｐｔｕａｌｌｙ　ｓｐｅａｋｉｎｇ，　ｄｏ　ｗｅ　ｎｅｅｄ　　ｎｅｗ　ｔｅｃｈｎｏｌｏｇｉｅｓ　ｌｉｋｅ　 Ｍｅｔａｌ－Ａｉｒ，　lithium anode,　ｏｒ　ｏｔｈｅｒｓ　ｔｏ　ａｃｈｉｅｖｅ　ｔｈｉｓ？

based on the earnings call I would say there will be no anode and cathodes but nothing more than that than the many savings that will come from the Gigafactory .. in other news ... if possible please refrain from typing that way ... all the changes in it messes with my brain

 

[RABaby]

This may all be obvious, but too much is made about the need for highly skilled people or how Tesla needs to find a location that will entice people to move. I don't think that is an issue at all.

The Gigafactory is projected to eventually employ around 6,500 employees, just as it is projected to cost around $5 billion when fully operational. In both the case of the expenses as well as employee head count, it won'-t be all at once. The expenses will accrue as more structure, more equipment, and more employees are added. And more employees will be hired as the factory expands.

As to the skill level required, there will be several levels of skill/experience/education Tesla will be needing. Not everyone, and probably not the bulk, will need a high skill level. This is a new type of factory and we don't know for sure what sorts of tasks will need to be performed but we can probably assume that the highest skill level is already part of the development team and that they will be determining what experience is necessary for each piece of equipment or task. Once the factory is under construction, the "now hiring" sign will go out and the only qualification to get hired may be to pass an aptitude test. Those selected will be trained by Tesla so that they are familiar with the equipment as it gets installed and set up.

So basically, I don't think there will be a big need for experience in high skill levels because the skill will increase over time and before Model 3 is delivering 500,000 cars a year. The first employees will work with those putting the plant together and once they are independent, they will train newer employees, and then you will have trained personnel to open the subsequent Gigafatories.