Battery Issues = More Problems for Tesla

Tesla is one of the most ambitious companies in the world, but it may have just bitten off more than it can chew. Gigafactory Berlin is reportedly experiencing issues with battery production and has been experiencing a few setbacks in the last few months. With this information, it seems likely that the German plant will not be able to ramp up production like its sister factories in America.

The Real Issue

Tesla is having trouble setting up battery cell production at the Gigafactory Berlin, so it is relocating the necessary machinery to Texas.

With a new 4680 format, Tesla has been attempting to produce its battery cells for more than two years. As the company uses a new structural battery pack architecture to power its next generation of electric vehicles, the plan is essential to the business’s long-term future.

Tesla is presently producing the cells at its pilot facility in Fremont, California, but it intended to start mass producing the 4680 battery cell at the Gigafactory Texas by the end of the year. In Gigafactory Berlin.

It appeared that Tesla was prepared to increase battery production at its new German factory as soon as the necessary permissions and arrangements could be made by the relevant parties.

But according to a more recent Handelsblatt article from Germany, Tesla appears to be delaying the project in Berlin:

The fact that Tesla will not start full battery cell production in its German plant in Grünheide, for the time being, has other reasons than lower energy costs and new tax incentives in the USA worth billions. Several sources close to the electric car manufacturer report a significant delay in a crucial but highly complex production technique.

The report had previously stated that Tesla intended to relocate some of the machinery used to make battery cells from the Gigafactory Berlin to the Gigafactory Texas. The action was thought to be related to the US’s new tax credit for electric vehicles, which requires automakers to utilize locally made battery cells.

According to recent reports, only the equipment needed to produce electrodes will stay on-site; everything else will be relocated to the US.

Several drone flyovers and various tours at Giga Texas revealed clear evidence of battery-related equipment, and Tesla has confirmed that the Texas factory will make batteries. Only recently did it come to light that Tesla was also planning on producing batteries in Germany.

The decision’s motivation is unclear, but according to Handelsblatt, Tesla wants to concentrate on launching its dry coating of the electrodes successfully in the US first:

This is not a rejection of Grünheide. Tesla boss Elon Musk wants to continue to build a battery cell plant in Brandenburg in the long term. But before that, the electric car manufacturer has to get the so-called dry coating of the electrodes under control. A total of five experts, two of whom are close to Tesla, report that test systems with the technology are currently running quite successfully, but that implementation in large series is lacking.

Tesla has already acknowledged that one of the bottlenecks stopping the company from achieving battery cell volume manufacturing is the dry coating process.

In its most recent statement, the business reiterated its belief that volume production at the Gigafactory Texas will be accomplished by the year’s end.


But given the issues with setting up the factory, Tesla is now instead bringing battery manufacturing equipment back to California and scaling that line up while it continues to push forward on Gigafactory Berlin.