Tesla’s Berlin plant launch in October could be a catalyst for stocks to rise.
Tesla Investors (TSLA) will soon receive either excellent news or disappointment. According to CEO Elon Musk, the Gigafactory in Berlin may start in October. Musk plans to organize a plant tour to ensure that all final approvals from the local community and authorities are received.
The Tesla plant in Brandeburg, near Berlin, started construction early last year and should help the company on its way to expand production and become the leader in electric vehicles in Europe.
However, investors are worried about delays in the Tesla Gigafactory Berlin commissioning date, which has already been pushed back from July to October 2021.
Tesla’s plans to build a plant have been generally well-received by the authorities, given many jobs and future tax revenues. However, CEO Elon Musk complained that bureaucratic procedures in Germany have caused the initial launch of the plant to be postponed and could become a problem.
Tesla’s plant on the outskirts of Berlin also faced opposition from environmental organizations, but the company later said it had been resolved problems.
On Friday, Musk visited a plant under construction in Berlin, confirming that Tesla hopes to release its first cars there in October or sooner.
Musk is also planning a factory tour for the Brandenburg-Berlin local community members to garner support and get all final approvals to start production.
Today Tesla has two large factories: Gigafactory # 1 in Fremont, USA, Gigafactory # 2 in Shanghai, China.
The Gigafactory Berlin will be the second outside the United States and ease the logistical challenge of exporting Tesla electric vehicles to Europe. Today, these deliveries to European customers from the Shanghai plant.
Commenting on Tesla’s recent report on July shipments, Musk said shipments of electric vehicles from the Chinese factory in the first half of the year are more focused on exports to Europe than the Chinese market. Partly explains the sharp slowdown in Tesla sales in China in July.
With the launch of the Berlin plant, Tesla will not have to organize expensive shipments from China; the company will be able to cut costs and increase production over time.
In addition, the Gigafactory Berlin will produce the increasingly popular Model Y with a new battery design and new technologies.
Musk has previously stated that he believes Model Y sales will surpass all other Tesla vehicles combined.
Europe’s drive towards electric vehicles, manufacturer subsidies, and consumer subsidies should also boost Tesla’s sales in this large region.
“Which Companies Will Benefit from the US Transition to Electric Vehicles by 2030?” wrote that China and Europe are leading the world in the success of the transition to electric vehicles.
If the Tesla Gigafactory Berlin in October, investors should expect a jump in stock growth.
Tesla shares are up 121% in the past year, but chip shortages have caused them to decline from their highs in January.
