Tesla to start battery cell production in Grünheide from 2027

Tesla CEO Elon Musk announced as early as 2020 that, in addition to the car factory officially known as Gigafactory Berlin-Brandenburg in Grünheide, the company also planned to establish the world’s largest battery cell production facility. The initial annual capacity was set at an impressive 100 GWh per year, with plans to later expand to up to 250 GWh. For comparison: VW subsidiary PowerCo is initially planning with a capacity of 20 GWh at its new facility in Salzgitter, with a potential later expansion to 40 GWh.

However, Tesla put its plans for series production of battery cells in Grünheide on hold in 2022—the same year the car factory opened—prioritising the US due to the prospect of substantial subsidies. Now, battery cell production in Brandenburg is finally set to become a reality: according to reports from the Frankfurter Allgemeine Zeitung and the news agency dpa, production is expected to commence in 2027. The new cell production facility is anticipated to create hundreds of jobs. Tesla has already advertised a position for a Battery Cell Production Manager and other roles for its cell manufacturing operations.

However, the initial production capacity is expected to be a modest 8 GWh per year. This would be sufficient for around 2,000 electric vehicles per week, while Grünheide currently has the capacity to produce up to 7,500 vehicles. In other words: even at full capacity, the site will not be able to produce all the cells required for its vehicle production.

Tesla plans to invest nearly one hundred million euros in the relevant production facilities, according to plant manager André Thierig. He told FAZ: “In total, we will have invested almost one billion euros in the cell factory.” The goal behind cell production in Grünheide is to further increase the depth of value creation at the site and produce all components—from the battery cell to the finished electric vehicle—in Grünheide. “This is unique in Europe; no other production site offers this,” Thierig stated.

However, Tesla is keeping a back door open—hardly surprising given the CEO’s unpredictable nature and concerns about a potential victory for the IG Metall union in the works council elections in March. As the company explained to dpa: “If the conditions are right, the entire battery value chain will be established in Grünheide in the future,” meaning the full process from cell production to battery pack assembly and installation in electric vehicles. In other words, if the conditions are not met, Tesla could once again reverse its decision.

Until recently, Tesla used both LFP cells from CATL and NCM cells from LG Energy Solution for the various versions of the Model Y in Grünheide. It was only recently revealed that Tesla is now also assembling battery packs at its existing battery assembly facility in Grünheide using 4680 battery cells produced by Tesla itself in Austin, Texas—another step towards reducing dependency on suppliers and increasing value creation. However, it is likely that Tesla is not yet using exclusively its own cells, though the company remains tight-lipped on the matter.

faz.net, handelsblatt.com (both in German)