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Tesla plans new “Gigafactory” to become largest global battery plant

Planned to be the world’s largest battery plant, the plant is expected to be operational by 2017 and, according to a blog by Tesla, will produce more lithium-ion batteries annually by 2020 than were produced worldwide in 2013. The firm's projection is that it will be building enough batteries for over 500,000 vehicles by 2020.

Tesla said that the plant provides an ‘opportunity to leverage our projected demand for lithium ion batteries to reduce their cost faster than previously thought possible' and said that be working with strategic battery manufacturing partners, the factory would achieve economies of scale and minimise costs through ‘innovative manufacturing, reduction of logistics waste, optimization of co-located processes and reduced overhead’.

It added that: ‘By the end of the first year of volume production of our mass market vehicle, we expect the Gigafactory will have driven down the per kWh cost of our battery pack by more than 30%.’

The firm is currently considering sites in Arizona, Nevada, New Mexico and Texas, with the battery packs to be transported from the Gigafactory to its vehicle assembly plant in Fremont, California.

Together with its partners Tesla will invest $4-5bn in the Gigafactory through 2020, of which it will invest around $2bn itself, with around 6,500 staff to be employed. Partners are rumoured to include Panasonic.

Last year Tesla announced that it is to launch a long-range lower-cost model in 2016, hinting that it could be half the price of the Model S. Speaking at the time, CEO Elon Musk confirmed the company was working with partners including Panasonic to develop a new generation of batteries with a range in excess of 200 miles to power it.

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Natalie Middleton

Natalie has worked as a fleet journalist for nearly 20 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. Natalie edits all the Fleet World websites and newsletters, and loves to hear about any latest industry news - or gossip.

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