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Tesla's Gigafactory in Shanghai

Media_Truth

Media_Truth

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Bold, Irresponsible, Lackluster, Visionary --- you will find all these words, and many more, in articles and opinions about Tesla. However, wealthy entrepeneurs continue to gamble large sums of money on large potential future payouts. What other company has had the balls to take on the American Auto Industry? Although Tesla is still struggling with profitability margins, they are rolling cars off an assembly line in California.

But the Gigafactory being built in China is enormous.

Tesla-Gigafactory-3.jpg

The May 2019 article is worth a read, but here are a few excerpts...

Tesla Gigafactory 3 building in Shanghai looks almost complete - Electrek

About 7 months ago, Tesla announced a deal with the Shanghai government to build a wholly owned local factory and only about 5 months ago, they secured the 210-acres of land for Gigafactory 3 in China necessary. They officially broke ground in January and plan to be done with the building by this summer.

Considering the size of the building, it seemed almost impossible, but a new drone video update shows that the building is almost complete (from Jason Yang):
...
When first announcing the plant, Tesla said that it expects “construction to begin in the near future” and that it “will take roughly two years” until they start volume production with a planned capacity of 200,000 units and “then another two to three years before the factory is fully ramped up to produce around 500,000 vehicles per year for Chinese customers.

More recently, Musk said that Tesla wants to produce 3,000 Model 3 vehicles at Gigafactory 3 in Shanghai by the end of the year.

The CEO said that they plan to start production at the beginning of the fourth quarter.

This is insane! Build a plant this size and begin producing units, all within a year.
 
Media_Truth said:
This is insane! Build a plant this size and begin producing units, all within a year.
Click to expand...
When you don't have USA safety and environmental regulations holding you back, it's not so hard.
 
Lord of Planar said:
When you don't have USA safety and environmental regulations holding you back, it's not so hard.
Click to expand...

Certainly spoken by somebody who's never built anything complicated or large before. Everything would just be so damn easy if it wasn't for those pesky regulations! :roll:
 
RabidAlpaca said:
Certainly spoken by somebody who's never built anything complicated or large before. Everything would just be so damn easy if it wasn't for those pesky regulations! :roll:
Click to expand...

I don't think they'll actually produce vehicles in 2019, but many thought the construction schedule was impossible, but they seem to be on target, or close. The article mentioned that they originally thought it would take 2 years for "vehicle production". When I worked in industry, the execs always wanted to do things quicker, and for less money. I was one of the guys that tried to make that happen, but schedules were often delayed by some bottleneck.
 
Lord of Planar said:
When you don't have USA safety and environmental regulations holding you back, it's not so hard.
Click to expand...

The Fortune 500 company I worked for for 25+ years (unnamed) had factories in China. No doubt, things operate differently there. One interesting note- they don't need large employee parking lots. The employers provide bus service for employees. I'm not sure if this is universal, but it was at our plants.
 
RabidAlpaca said:
Certainly spoken by somebody who's never built anything complicated or large before. Everything would just be so damn easy if it wasn't for those pesky regulations! :roll:
Click to expand...

It really would. It took less then 3 years to erect multiple bridges in the San Francisco Bay in the 1930s
 
EMNofSeattle said:
It really would. It took less then 3 years to erect multiple bridges in the San Francisco Bay in the 1930s
Click to expand...

I was involved in a large industrial plant startup in 2018, in Arizona, and approvals, equipment power-ups, etc, were moving relatively quickly. After the first few area power-ups, it became somewhat cookie-cutter. I thought it was a good balance of concern for safety (first and foremost) and production goals.
 
Media_Truth said:
I was involved in a large industrial plant startup in 2018, in Arizona, and approvals, equipment power-ups, etc, were moving relatively quickly. After the first few area power-ups, it became somewhat cookie-cutter. I thought it was a good balance of concern for safety (first and foremost) and production goals.
Click to expand...

Shhhhhh!! You're destroying the finely crafted corporatist narrative. Massive projects that could be built in a few days for pennies now take decades at billions of dollars because mean old Uncle Sam tries to make sure the local populace isn't poisoned in the process and their ecosystem destroyed.
 
Media_Truth said:
Bold, Irresponsible, Lackluster, Visionary --- you will find all these words, and many more, in articles and opinions about Tesla. However, wealthy entrepeneurs continue to gamble large sums of money on large potential future payouts. What other company has had the balls to take on the American Auto Industry? Although Tesla is still struggling with profitability margins, they are rolling cars off an assembly line in California.
Click to expand...
Struggling? Tesla hasnt made a profit ever since it was incorporated. This whole thing is starting to feel like the dot com bubble of the early 2000s.
 
PoS said:
Struggling? Tesla hasnt made a profit ever since it was incorporated. This whole thing is starting to feel like the dot com bubble of the early 2000s.
Click to expand...

Amazon didn't declare any profits for about 15 years because they put every single penny of profit back into infrastructure. This is exactly what Tesla is doing. They're selling their cars at a profit but are not declaring profits as reinvesting in more factories and more automation is the better long term play.

Intentionally delaying declaration of profit to invest in growth is a legitimate strategy. No, they are not selling cars at a loss.
 
RabidAlpaca said:
Amazon didn't declare any profits for about 15 years because they put every single penny of profit back into infrastructure. This is exactly what Tesla is doing. They're selling their cars at a profit but are not declaring profits as reinvesting in more factories and more automation is the better long term play.

Intentionally delaying declaration of profit to invest in growth is a legitimate strategy. No, they are not selling cars at a loss.
Click to expand...

Actually, Amazon began making profits in its 6th year. Tesla is now 16 years old and counting. Its sales seems good, but until I see it making a profit no way would I ever invest in such a company.
 
PoS said:
Actually, Amazon began making profits in its 6th year. Tesla is now 16 years old and counting. Its sales seems good, but until I see it making a profit no way would I ever invest in such a company.
Click to expand...

There are entrapeneurs who deal in companies like Tesla. Ron Baron is the major shareholder. He says it will be a trillion dollar company by 2030.

Tesla could be a $1 trillion company by 2030: Shareholder Ron Baron

Major Tesla shareholder Ron Baron told CNBC on Tuesday the electric car maker could be a $1 trillion company in revenue by 2030.

“I think it could be a $500 billion battery business, $500 billion car business. I give that better than 50-50 chance,” the billionaire buy-and-hold investor said.

“The fact that it could be a $60 billion company in three years, I give that maybe 80 percent chance,” he added.

Baron also said Tesla, with full-year 2017 revenue of $11.75 billion, is close to self funding. In 2016, the company had $7 billion in revenue.
 
PoS said:
Actually, Amazon began making profits in its 6th year. Tesla is now 16 years old and counting. Its sales seems good, but until I see it making a profit no way would I ever invest in such a company.
Click to expand...

It's also incredible that they can secure the money for these kind of ventures. I was wondering how they managed to build this plant when they were already so overleveraged. The answer - Chinese loans.

Tesla To Fund Shanghai Gigafactory With Local Loans In China | CleanTechnica

After a question from an analyst about the financing, Tesla broke news that it planned to fund the new Shanghai Gigafactory with local debt from Chinese banks. This move allows Tesla to continue with its expansion without having to go back to the US debt markets or further dilute share price with another capital raise.
 
Lord of Planar said:
When you don't have USA safety and environmental regulations holding you back, it's not so hard.
Click to expand...

Psssh, breathable air is for ***** liberals. Everyone knows the environment is just a fake news hoax.



Chinese pollution 1.jpg
"Taste the Freedomz"




Chinese pollution 2.jpg

"I love the smell of cancer in the morning."
 
Media_Truth said:
Bold, Irresponsible, Lackluster, Visionary --- you will find all these words, and many more, in articles and opinions about Tesla. However, wealthy entrepeneurs continue to gamble large sums of money on large potential future payouts. What other company has had the balls to take on the American Auto Industry? Although Tesla is still struggling with profitability margins, they are rolling cars off an assembly line in California.

But the Gigafactory being built in China is enormous.

View attachment 67262341

The May 2019 article is worth a read, but here are a few excerpts...

Tesla Gigafactory 3 building in Shanghai looks almost complete - Electrek

About 7 months ago, Tesla announced a deal with the Shanghai government to build a wholly owned local factory and only about 5 months ago, they secured the 210-acres of land for Gigafactory 3 in China necessary. They officially broke ground in January and plan to be done with the building by this summer.

Considering the size of the building, it seemed almost impossible, but a new drone video update shows that the building is almost complete (from Jason Yang):
...
When first announcing the plant, Tesla said that it expects “construction to begin in the near future” and that it “will take roughly two years” until they start volume production with a planned capacity of 200,000 units and “then another two to three years before the factory is fully ramped up to produce around 500,000 vehicles per year for Chinese customers.

More recently, Musk said that Tesla wants to produce 3,000 Model 3 vehicles at Gigafactory 3 in Shanghai by the end of the year.

The CEO said that they plan to start production at the beginning of the fourth quarter.

This is insane! Build a plant this size and begin producing units, all within a year.
Click to expand...

You are seeing a great expansions of battery factories all across the world. For example also Northvolt in Europe. That Tesla have played a vital role for this positive development.

Northvolt secures $1bn for battery gigafactory in Sweden – pv magazine International
 
Media_Truth said:
It's also incredible that they can secure the money for these kind of ventures. I was wondering how they managed to build this plant when they were already so overleveraged. The answer - Chinese loans.

Tesla To Fund Shanghai Gigafactory With Local Loans In China | CleanTechnica

After a question from an analyst about the financing, Tesla broke news that it planned to fund the new Shanghai Gigafactory with local debt from Chinese banks. This move allows Tesla to continue with its expansion without having to go back to the US debt markets or further dilute share price with another capital raise.
Click to expand...

A loan? Egads. Definitely one more reason not to invest with Tesla.
 
Media_Truth said:
Seems some people want those "good ole days" back. Including the head of the EPA...

Trump administration moves to loosen restrictions on coal | Q13 FOX News
Click to expand...
From your article,
the Trump administration ordered a sweeping about-face Wednesday on Obama-era efforts to fight climate change, easing restrictions on coal-fired power plants in a move it predicted would revitalize America’s sagging coal industry.
Click to expand...
The Obama-era rule changes were not about limiting some of the nasty coal ash products, but rather limiting CO2.
Also the regulations had not even started yet when Obama left office, so no, no is talking about going back to the "good old days"!
This is about removing regulations which would not have allowed coal to compete because of CO2, not other emissions.
Coal should go away, but not because of regulatory hurdles, not required of other sources of energy generation.
Coal will likely die because of it's own logistical tail, but let it die from market forces, not government fiat.
 
longview said:
From your article,

The Obama-era rule changes were not about limiting some of the nasty coal ash products, but rather limiting CO2.
Also the regulations had not even started yet when Obama left office, so no, no is talking about going back to the "good old days"!
This is about removing regulations which would not have allowed coal to compete because of CO2, not other emissions.
Coal should go away, but not because of regulatory hurdles, not required of other sources of energy generation.
Coal will likely die because of it's own logistical tail, but let it die from market forces, not government fiat.
Click to expand...

The Media propaganda types don't understand facts.
 
longview said:
From your article,

The Obama-era rule changes were not about limiting some of the nasty coal ash products, but rather limiting CO2.
Also the regulations had not even started yet when Obama left office, so no, no is talking about going back to the "good old days"!
This is about removing regulations which would not have allowed coal to compete because of CO2, not other emissions.
Coal should go away, but not because of regulatory hurdles, not required of other sources of energy generation.
Coal will likely die because of it's own logistical tail, but let it die from market forces, not government fiat.
Click to expand...

Even Fox Business report about the steep cost of Trump’s support for the fossil fuel industry.

Trump rollbacks for fossil fuel industries carry steep cost | Fox Business

"— Up to 1,400 additional premature deaths annually due to the pending repeal of a rule to cut coal plant pollution.

— An increase in greenhouse gas emissions by about 1 billion tons (907 million metric tons) from vehicles produced over the next decade — a figure equivalent to annual emissions of almost 200 million vehicles.

— Increased risk of water contamination from a drilling technique known as "fracking."

— Fewer safety checks to prevent offshore oil spills."

Trump energy bailout is coal in taxpayers’ stockings | Fox Business

While even federal agencies under Donald Trump acknowledge the urgent need for action on global warming from C02.

Fourth National Climate Assessment
 
Bergslagstroll said:
Even Fox Business report about the steep cost of Trump’s support for the fossil fuel industry.

Trump rollbacks for fossil fuel industries carry steep cost | Fox Business

"— Up to 1,400 additional premature deaths annually due to the pending repeal of a rule to cut coal plant pollution.

— An increase in greenhouse gas emissions by about 1 billion tons (907 million metric tons) from vehicles produced over the next decade — a figure equivalent to annual emissions of almost 200 million vehicles.

— Increased risk of water contamination from a drilling technique known as "fracking."

— Fewer safety checks to prevent offshore oil spills."

Trump energy bailout is coal in taxpayers’ stockings | Fox Business

While even federal agencies under Donald Trump acknowledge the urgent need for action on global warming from C02.

Fourth National Climate Assessment
Click to expand...

Can you show where any of the planned reductions in regulations affect anything but CO2?
 
Update - Looks like they got the building enclosed just in time for monsoon season.

Construction charges ahead at Tesla's Shanghai Giga-factory | The Driven

The build has been underway for some seven months now, and the Gigafactory now has walls, a complete roof, carparks, air con units, windows, bay doors, and most recently, floor-to-ceiling windows have been put in place (just in time we hope before the devastating Typhoon Lekima made landfall on Monday).
...
“The construction of the Shanghai Super Factory has been smooth, and its construction has only been completed for 7 months, and is expected to be officially put into operation by the end of 2019,” the carmaker announced (translated from Chinese).
 
Lord Tammerlain said:
Most likely backed with IP rights if Tesla folds.
Click to expand...

Probably, but I don't think this is a big gamble for the lenders in China. There is probably some provision that Tesla must use the Chinese profits to repay the Chinese loan first. There are two trends in China that make this a win-win. First, China has some of the worst air quality in the world. Second, Chinese citizens are wealthier and demanding more personal comforts - i.e. personal cars. Tesla will be the major auto manufacturer in China. I also foresee this plant manufacturing vehicles for the rest of Asia.
 
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