Tesla Has Opened a New Plant

[Electric700]

Tesla just opened a new plant in the Netherlands! More here:

Tesla Opens First Plant in the Netherlands

 

[strider]

Interesting. Must be tax advantages for doing it that way.

 

[Raffy.Roma]

But this Tesla plant in the Netherlands does not produce the Model S from scratch because it receives the vehicles for final assembly and send them on their way across the Continent. I think that this Tesla plant in the Netherlands should be upgraded to produce the Model S from scratch.

 

[Electric700]

But this Tesla plant in the Netherlands does not produce the Model S from scratch because it receives the vehicles for final assembly and send them on their way across the Continent. I think that this Tesla plant in the Netherlands should be upgraded to produce the Model S from scratch.

I agree with you. May be they have plans for expanding the new plant at some point in the future.

 

[schpere]

They are smart to do this. One, it allows for higher production levels in USA factory thereby making it more efficient. Also, let's them "tip their toe" into the Euro market without the massive investment a car plant will take. Also, they have not fully utilized the floor capacity of their California plant. I think they are only using a fraction of that actual space.

 

[sublimaze1]

This will also allow them to adjust manufacture for euro-spec production - if said construction is a savings. I am sure there is some tax or fee-based break for the assembly there (just like we have "final assembly" locations stamped on our cars).

They may even build the RHD version there if Britain becomes a big buyer like we think. Aus and Jap/HK will most likely be supplied by the Pacific based plant (then again, Musk does not think like the rest of us and all this is pure supposition).

 

[callmesam]

Anyone know what Model S "final assembly" means?

 

[LuckyLuke]

In Fremont the battery and motor are removed from the car and shipped separately to Tilburg. In Tilburg all they do is mount those back together, do an alignment and probably some final software update and the car is ready to be delivered somewhere in the EU.

 

[Right_Said_Fred]

In Fremont the battery and motor are removed from the car and shipped separately to Tilburg. In Tilburg all they do is mount those back together, do an alignment and probably some final software update and the car is ready to be delivered somewhere in the EU.

And the main reason for doing so is that the EU import tariff for parts (engine, battery) is lower than for cars. So they pay a tariff of 5% (not sure about that number) on the engine and battery and a tariff of 10% on the car minus the battery and engine. Because of the high cost of battery and engine this is worthwile and offsets the extra costs of hiring the building and personnel.

 

[pfq1982]

And the main reason for doing so is that the EU import tariff for parts (engine, battery) is lower than for cars. So they pay a tariff of 5% (not sure about that number) on the engine and battery and a tariff of 10% on the car minus the battery and engine. Because of the high cost of battery and engine this is worthwile and offsets the extra costs of hiring the building and personnel.

Is there precedent for doing this by other manufacturers?

If Tesla is the first one to navigate the tariff rules like this, I wonder if there is risk of whatever European trade regulatory body saying there is a problem here. European governments love their tax revenue!

 

[PeterSZ]

And the main reason for doing so is that the EU import tariff for parts (engine, battery) is lower than for cars. So they pay a tariff of 5% (not sure about that number) on the engine and battery and a tariff of 10% on the car minus the battery and engine. Because of the high cost of battery and engine this is worthwile and offsets the extra costs of hiring the building and personnel.

Correct. But I seriously doubt if they would have come to our Nether Land if we (the Dutchmen) wouldn't have bought so many S's as we did :biggrin:

 

[jaanton]

I wonder if there are other differences then just final assembly. For example the whole refrigerant regulation in the EU is different from the US and might involve different equipment in the EU. See http://www.reuters.com/article/2013/08/08/us-honeywell-germany-idUSBRE9770LX20130808

 

[gregincal]

I wonder if there are other differences then just final assembly. For example the whole refrigerant regulation in the EU is different from the US and might involve different equipment in the EU. See http://www.reuters.com/article/2013/08/08/us-honeywell-germany-idUSBRE9770LX20130808

There are differences in the Euro spec cars, but that is all handled in Fremont.

 

[mhpr262]

They are smart to do this. One, it allows for higher production levels in USA factory thereby making it more efficient. Also, let's them "tip their toe" into the Euro market without the massive investment a car plant will take. Also, they have not fully utilized the floor capacity of their California plant. I think they are only using a fraction of that actual space.

I assume they are reserving the remaining production capability of the Fremont plant for the Gen III car. Also, as Elon has said, it makes more sense to produce cars closer to the markets where they will be sold to save transport costs. He's welcome to open a plant in Germany ... :smile:

 

[Kaivball]

There is capacity to make >100k cars per year in Fremont.

 

[jerry33]

There is capacity to make >100k cars per year in Fremont.

True but Tesla is using some of that space for indoor testing--something that wasn't possible when it was Toyota/GM. I don't think they'd want to get rid of indoor testing because it allows them to be paparazzi-free when they explore new designs.