Tesla To Begin Production At Gigafactory Ahead Of Schedule

Nov 05, 2015 04:17 PM EST | John Nassivera


Tesla Motors announced Tuesday that it will begin production at its Gigafactory earlier than expected, more specifically by the end of 2016.

The move, revealed in a third quarter shareholder letter, puts the electric car maker several quarters ahead of schedule, as it originally planned to begin production cells in 2017 after unveiling the facility in 2014, according to Tech Insider.

The announcement also follows a month after Tesla CEO Elon Musk said that his company already received its certificate of occupancy and would start production as soon as Spring 2016.

The Gigafactory, located just outside of Reno, Nev., will go towards building lithium-ion batteries for Tesla's electric cars, Tech Insider noted.

Tesla plans on having the factory completely up and running by 2020 and building 500,000 vehicles in the next five years. The factory is also needed for the automaker to begin production for the Model 3.

The facility will also be used to produce the Powerpack and Powerwall, batteries that are designed to plug into the power grid, connect to buildings and work with solar panels, Fortune reported. Tesla said that it started assembling these batteries in the third quarter of this year at its factory in Fremont, Calif. and "relocated production from Fremont to an automated assembly line at the Gigafactory" in the early part of the fourth quarter.

The Powerpack and Powerwall would be able to help business owners and home owners lower electricity bills by powering buildings during high grid electricity rates, as well as help utilities operate their grids more smoothly and save money by avoiding the construction of extra power plants. The batteries are experiencing great demand in Germany, South Africa and Australia and are already sold out for 2016.

Tesla also said it recently signed two orders for lithium oxide so it can "promote sourcing of this commodity at lower cost and with reduced environmental impact," according to Clean Technica.

"We are planning on establishing further supplier arrangements with the intent of having a robust, flexible and cost effective supply chain in place for our long-term needs," the company said in the letter.

Tesla will have several competitors to deal with after production for the Gigafactory is complete, Tech Insider noted in a separate report. Oher automakers that plan to enter the EV market in the next few years include General Motors, Volvo, Daimler and Volkswagen.

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