Tesla puts plans for complete battery production in Grünheide on hold

Tesla has apparently drawn up a new production strategy for its Gigafactory in Grünheide near Berlin. According to this strategy, the planned production of battery cells is to be scaled down and the focus is to be on vehicle production instead. The reason for this is the tax advantages that the U.S. offers in the field of battery manufacturing.

Tesla favors battery production in the US

The so-called United States Inflation Reduction Act (IRA) is a major irritant for the German automotive industry. After all, the U.S. government has hereby created new framework conditions that are intended to ensure that national automotive production flourishes. This includes not only the fact that horrendous tariffs are to be imposed on vehicles that do not originate from US production. On top of that, the IRA introduced attractive tax breaks that are also intended to make the production of batteries in the USA more attractive. Tesla is one of the first automotive companies to take advantage of the new regulations and is changing its strategy for green heath, as reported by Bloomberg and others. This envisioned building a huge battery factory in addition to the vehicle production plant.

This is quite astonishing. After all, Tesla CEO Elon Musk announced in 2019 that the world’s largest Tesla factory for battery cells would be built in Grünheide. However, this ambitious plan has now come to nothing. Instead, battery production will take place in the U.S. due to financial incentives, according to Tesla. However, this does not mean that the company now wants to put its battery production in Grünheide completely on ice. Instead, the company no longer wants to build entire batteries, but only components. In particular, electrodes will continue to be produced at the Gigafactory and then shipped to the USA for further production. On top of that, the traction batteries for the Tesla Model Y are to be built in Grünheide in the future.

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No surprise to experts

Both competitors and industry experts are not too surprised by the development. After all, Tesla is said to have already focused its battery production in the US before the IRA took effect. Meanwhile, local authorities and residents will be happy about the development. After all, there was trouble again just recently when Tesla started building solar roofs over the Gigafactory parking lots without permission. The development, meanwhile, is likely to worry more than just local auto companies. The semiconductor industry could well be fearful about the future as well. After all, the USA with its attractive tax breaks and subsidies could lure important industries to it in the future.