Tesla is looking to expand Giga Austin, and add a new factory in Indonesia
Tesla (TSLAPlans to expand production have come into focus after two recent reports, despite concerns from the analyst community that demand is drying up.
Last night the Wall Street Journal He was the first to report Tesla was seeking to spend $775 million to expand the Austin Gigafactory. According to regulatory filings, work on the expansion could begin as early as this month.
Tesla is currently producing the Model Y SUV at Giga Austin, and will eventually build the upcoming Cybertruck EV minivan at the factory as well. There have been recent reports of massive giga press stamping robots It was delivered to the Austin plant recently, which indicates the start of an increase. Some Tesla watchers assume that the new Giga pistons will be used to produce the Cybertruck.
Tesla is also looking to expand internationally as well, beyond its two factories in Berlin and Shanghai.
Tesla CEO Elon Musk has said in the past that he would like to build an additional 10 to 12 Gigafactories around the world, and a Bloomberg report suggests he may have found a new location.
It is said that Tesla About to sign a deal with the Indonesian government to build its next giant factory there, sources told Bloomberg. The plant is said to build 1 million jumbo cars annually, which is much higher than the current capacity of 750,000 in Giga Shanghai, but consistent with the company targeting production wise for all of its plants.
The sources also said Tesla’s talks with the government include plans for multiple facilities in the vast archipelagic country, which will handle production along with supply chain needs. No agreement has been signed yet, and talks are ongoing.
Indonesia may seem like a good location for Tesla’s growth plans, as the country has already struck a deal with Tesla to supply the automaker with nickelsAnd the country’s president has indicated that he would like Tesla to build a factory there.
Indonesia’s relatively cheap labor cost makes the factory a cost-effective option for Tesla, too, as it pursues its long-term goal of a 50% compound annual growth rate (CAGR) in deliveries.
Concern among investors and Wall Street grew as Tesla was forced to lower prices in the United States At the end of last year and recently In China for the second time. Even though Tesla has solid profit margins, lowering prices is seen as a way to boost demand when it’s waning. New competition in the form of longtime automakers ramping up new electric vehicle models, and upstart Chinese automakers with cheaper EV offerings, has weighed on Tesla shares in recent months.
The stock was hit again last week when Tesla reported total production and deliveries For the fourth quarter and year, with total annual deliveries of 1.3 million, Missing Street estimates are approximately 1.4 million.
Investors will hear more about Tesla’s financials and long-term guidance when the company reports earnings on January 25 and get an update on its expansion plans and new model platform at Investor Day, scheduled for March 1 of this year.
Pras Subramanian is a correspondent at Yahoo Finance. You can follow it Twitter and on Instagram.
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