Thứ Ba, 1 tháng 11, 2016

Tesla Gigafactory Investor Thread part 2

  • Feb 26, 2014
    kenliles
    I wonder if they haven't updated since the huge deposits were found here in US; otherwise, you're right it's conflicting
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  • Feb 26, 2014
    JRP3
    I believe that report also predates the huge Wyoming lithium discovery.
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  • Feb 26, 2014
    Robert.Boston
    "Reserves" are literally stocks of stored lithium, i.e. production + imports - exports.
    "Resources" is an estimate of what's in the ground and commercially accessible.
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  • Feb 26, 2014
    Discoducky
  • Feb 26, 2014
    Ocelot
    been thinking about western lithium and now rbi with all the talk of the giga factory. After seeing 15% gains for a couple days, held off, only to see huge gains again today. Jump in now, or see where dust settles?
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  • Feb 26, 2014
    Subhuman
  • Feb 26, 2014
    carrerascott
  • Feb 26, 2014
    Citizen-T
  • Feb 26, 2014
    v12 to 12v
  • Feb 26, 2014
    Mario Kadastik
    The press release is gone and the blog is restricted to owners? Also, my My Tesla account doesn't give me permission to see it.
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  • Feb 26, 2014
    Jeeps17
  • Feb 26, 2014
    carrerascott
    I'm logged in (and an owner) and access denied.

    The other link works though.
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  • Feb 26, 2014
    Blurry_Eyed
    PALO ALTO, Calif., February 26, 2014 � Tesla announced today an offering of $1.6 billion aggregate principal amount of convertible senior notes in an underwritten registered public offering. Of the total offering, Tesla will offer $800 million aggregate principal amount of convertible senior notes due 2019 and $800 million aggregate principal amount of convertible senior notes due 2021. In addition, Tesla intends to grant the underwriters a 30-day option to purchase up to an additional $120 million in aggregate principal amount of convertible senior notes due 2019 and an additional $120 million in aggregate principal amount of convertible senior notes due 2021, for a total potential offering size of up to $1.84 billion.

    Tesla intends to use the net proceeds from the offering to accelerate the growth of its business in the U.S. and internationally, for the development and production of its �Gen III� mass market vehicle, the development of the Tesla Gigafactory and other general corporate purposes.

    The convertible senior notes due 2019 will be convertible into cash, shares of Tesla�s common stock, or a combination thereof, at Tesla�s election. The convertible senior notes due 2021 will be convertible into cash and, if applicable, shares of Tesla�s common stock (subject to Tesla�s right to deliver cash in lieu of such shares of common stock). The interest rate, conversion rate and other terms of the notes are to be determined.

    In connection with the offering of the notes, Tesla intends to enter into convertible note hedge transactions and warrant transactions, which are generally expected to prevent dilution up to approximately 100% over the common stock price at the time of pricing of the notes due 2019 and 120% over the common stock price at the time of pricing of the notes due 2021. Tesla intends to use a portion of the proceeds from the offering to pay the net cost of the convertible note hedge transactions. In connection with establishing their initial hedge of the convertible note hedge and warrant transactions, the hedge counterparties or their affiliates expect to enter into various derivative transactions with respect to our common stock concurrently with or shortly after the pricing of the notes, including with certain investors in the notes.

    Goldman, Sachs & Co., Morgan Stanley, J.P. Morgan and Deutsche Bank Securities are acting as joint book-running managers for the offering.

    An effective registration statement relating to the securities was filed with the Securities and Exchange Commission on May 15, 2013. The offering of these securities will be made only by means of a prospectus supplement and the accompanying prospectus. Copies of the preliminary prospectus supplement and the accompanying prospectus may be obtained from Goldman, Sachs & Co., via telephone: (866) 471-2526; facsimile: (212) 902-9316; email: [email�protected]; or standard mail at Goldman, Sachs & Co., Attn: Prospectus Department, 200 West Street, New York, NY 10282-2198; from Morgan Stanley & Co. LLC, Attn: Prospectus Department, 180 Varick Street, Second Floor, New York, NY 10014, or by telephone at (866) 718-1649 or email: [email�protected]; from J.P. Morgan Securities LLC, via telephone: (866) 803-9204; or standard mail at c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717; or from Deutsche Bank Securities Inc., via telephone: (800) 503-4611; email: [email�protected]; or standard mail at Attn: Prospectus Group, 60 Wall Street, New York, NY 10005.

    This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. The securities being offered have not been approved or disapproved by any regulatory authority, nor has any such authority passed upon the accuracy or adequacy of the registration statement, the prospectus contained therein or the prospectus supplement.


    Forward-Looking Statement
    Certain statements in this press release, including statements regarding the proposed public offering of convertible notes, and the convertible note hedge and warrant transactions, are �forward-looking statements� that are subject to risks and uncertainties. These forward-looking statements are based on management�s current expectations, and as a result of certain risks and uncertainties, actual events or results may differ materially from those contained in the forward-looking statements. Please refer to the registration statement on Form S-3 on file with the SEC and the prospectus and prospectus supplement included or incorporated by reference therein, as well as the other documents Tesla files on a consolidated basis from time to time with the SEC, specifically Tesla�s most recent Form 10-K. These documents contain and identify important factors that could cause the actual results for Tesla on a consolidated basis to differ materially from those contained in Tesla�s forward-looking statements. Tesla disclaims any obligation to update information contained in these forward-looking statements.


    Investor Relations Contact:
    Jeff Evanson
    Tesla Motors
    [email�protected]

    Press Contact:
    Liz Jarvis-Shean
    Tesla Motors
    [email�protected]
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  • Feb 26, 2014
    Subhuman
    Go to the Blog site on Tesla Motors. The link on the site is not working though.
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  • Feb 26, 2014
    v12 to 12v
    I'm logged in as an owner and I'm a registered shareholder. I'm denied access too. I think they put it up and then pulled it and changed it to the offering blog post.
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  • Feb 26, 2014
    Blurry_Eyed
    Looks like no additional shares available for now for the shorts to cover...
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  • Feb 26, 2014
    Citizen-T
    Clearly the blog on the GigaFactory has been staged and is ready to go. Not sure what they are waiting for...
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  • Feb 26, 2014
    Mario Kadastik
    Yes, isn't the wording pretty much leaving it open for Tesla to choose however they want to cover the $1.6B and the timelines for conversion are pretty far in the future. This looks like an ideal way to fund the gigafactory and the smallness of the offer is interesting. I had assumed 2-3B. BUT I STILL CAN'T GET THE DAMN BLOG OR PRESS RELEASE.
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  • Feb 26, 2014
    spacekadet
    Can someone translate this into layman's terms please? If I'm understanding correctly, Tesla is offering $1.6B ($1.84B max) of convertible notes. Half of them are to be paid back by 2019, and the other half by 2021. Interest rates and other details to be provided later... Is that everything? Is this good news?
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  • Feb 26, 2014
    brysondad
  • Feb 26, 2014
    Lloyd
    This report leaves out Bolivia which has the largest reserves. Reportedly 45 to as much as 80% of the worlds reserves of Li. Political process there has prevented any substantial mining to date.
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  • Feb 26, 2014
    FluxCap
  • Feb 26, 2014
    Mario Kadastik
    Well Tesla is actually offering not stock, but convertible notes. How they will be converted in 2019/2021 is up to Tesla (either they give back cash or partially stock or what not) so the actual possible dilution doesn't happen until 2019/21 if at all. Do I understand it right? If so, then this is pretty much a perfect setup, no?
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  • Feb 26, 2014
    v12 to 12v
    Too bad they didn't get a screen capture! Probably waiting until after the event tomorrow.
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  • Feb 26, 2014
    Citizen-T
    Alright guys, stop mashing ctrl+r on the Blog page. It is getting slooooooow. =)
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  • Feb 26, 2014
    Zaxxon
  • Feb 26, 2014
    justdoit
  • Feb 26, 2014
    kishdude
    Not much more info than we already knew. Haven't select the site yet - either NV, AZ, NM, or TX. Won't be operational until 2017. No partners listed.
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  • Feb 26, 2014
    FluxCap
    Text of Blog Post:

    "As we at Tesla reach for our goal of producing a mass market electric car in approximately three years, we have an opportunity to leverage our projected demand for lithium ion batteries to reduce their cost faster than previously thought possible. In cooperation with strategic battery manufacturing partners, we�re planning to build a large scale factory that will allow us to achieve economies of scale and minimize costs through innovative manufacturing, reduction of logistics waste, optimization of co-located processes and reduced overhead.

    The Gigafactory is designed to reduce cell costs much faster than the status quo and, by 2020, produce more lithium ion batteries annually than were produced worldwide in 2013. By the end of the first year of volume production of our mass market vehicle, we expect the Gigafactory will have driven down the per kWh cost of our battery pack by more than 30 percent. Here are some details about what the Gigafactory will look like."
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  • Feb 26, 2014
    DaveT
    My understanding with convertible notes is that the holder (not Tesla) chooses how they want it converted (ie., into stock or cash) at the expiration date.
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  • Feb 26, 2014
    farzyness
  • Feb 26, 2014
    uselesslogin
    I'm interested in the 35GWhr cell number and the 50GWhr pack number. Will they be using good cells from old packs and putting them in new packs for grid storage? I guess we'll see.
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  • Feb 26, 2014
    PokerBroker
  • Feb 26, 2014
    DingDingDao
    No word on who the "partners" are? Likely Panasonic but would be nice to know for sure. Unless I'm just blind and missed it.
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  • Feb 26, 2014
    ckessel
    Presumably still sourcing batteries from Panasonic (and/or others at that point) in addition to what the gigafactory will produce.
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  • Feb 26, 2014
    30seconds
    so the other interesting thing about this announcement is that TSLA has probably locked up something like 30-50% of WW li-ion battery capacity between existing agreements and gigafactory (assuming continued growth of existing players). Which kind of means that the other car markers need to stick to hybrids with smaller batteries or commit to building out their own factories. Over the next year or so it will become really apparent how serious existing manufacturers are about 100% EV just based on their (lack of) investment in battery manufacturing and if they really have the BEV infrastructure to compete.
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  • Feb 26, 2014
    Owner
    where do you think they will put it?

    Texas - not friendly to Tesla
    Arizona - has political issues

    Nevada - closer to Fremont and shipping
    New Mexico - several other factories there already, so may fit in better than Nevada?

    Thoughts?
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  • Feb 26, 2014
    AnOutsider
    thanks for posting as I'd missed it.

    *reads*
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  • Feb 26, 2014
    Johan
    Official Tesla Gigafactory Discussion Thread

    This is so true. They can't all buy from Tesla since there won't be enough cells or packs to go around + Tesla can set the price at will if the decide to LET THEM buy. The would become Tesla's b****hes...
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  • Feb 26, 2014
    farzyness
    Based on 17% CAGR on current LiOn battery production, Tesla will have 25% of the global battery production in 2020 at 35 GWh/Yr. Of the 75% remaining, how much of that will be allocated to other automakers? Tesla is setting itself up to be the go-to, if not only, mass supplier of batteries for EV utilization.

    This is HUGE.

    Remember, this 25% production only satisfies 500k car production by Tesla. Let's assume the remaining auto makers utilize 25% of the 75% left. That's 35GWh/Yr divided between any car maker that wants to manufacture EVs. However, I'm willing to bet none of these manufacturers will have the know how, technology, or even resources to come close to what Tesla is doing in the EV business, so their yield of the 35 GWh/Yr that I'm estimating here will be no where close to 500k cars that Tesla will be manufacturing. At best they'll be at 75% of what Tesla can manage based on the head start Tesla has, so call it 375k cars.

    How will those 375k EVs stack up vs. Tesla's? Will there even be 375k EVs from other manufacturers by then? Will they be selling them at a gross margin as high as Tesla? Will they be as fast? As good looking? Will they have the same "want" factor as the Tesla does? If other automakers do produce 375k cars, Tesla will have 57% of the EV market.

    I don't know about you guys, but this is pretty exciting.
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  • Feb 26, 2014
    Benz
    But does this mean that there will be no Conference Call Q&A session?
    That's actually what I was expecting after what was said during the ER Conference Call of last week.
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  • Feb 26, 2014
    DingDingDao
    Aren't there also some huge tax benefits to setting up shop in Nevada?
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  • Feb 26, 2014
    pz1975
    Maybe he will answer questions after his presentation today. I don't know the details of what the presentation is today, but maybe there will be press? Or maybe a CC afterwards? He did say press conference in the ER I think, not just press release.
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  • Feb 26, 2014
    AnOutsider
    or maybe create a bidding war? Couldn't demand drive up prices again?
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  • Feb 26, 2014
    Benz
    I think that we all are interested in knowing the details of what the presentation is today, right?
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  • Feb 26, 2014
    dsm363
    A guess of course but Nevada or Texas. I'd imagine whichever gives best package will get it.
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  • Feb 26, 2014
    austinEV
    Texas, just east of Austin!
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  • Feb 26, 2014
    DriverOne
    > Texas - not friendly to Tesla

    Opening up sales could be a key clause in the package Texas offers. We will see.
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  • Feb 26, 2014
    hobbes
    I was surprised about the 35GWhr cell number vs the 50GWhr pack number, too - now I think it is supposed to say that there will be a total of 85GWhr of cells of which "only" 50GWhrs will be built into packs. The rest would be sold to someone else... like Apple?
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  • Feb 26, 2014
    nvsblman
    The Texas legislature doesn't meet in even numbered years, that might be a roadblock to getting a deal done with the state.
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  • Feb 26, 2014
    Hells
    In the slides the arrow indicate they will process the old packs for raw materials, so it doesnt appear that way, but it could be deliberately obtuse.

    Logistics would matter a lot, which site would have the best shipping rail?

    Somewhat interesting is Tesla claims the yearly production of 35 gwh is equal to 500,000 vehicles. It would imply an average of 70 kwh per vehicle. Approx. 65kwh for Model E?
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  • Feb 26, 2014
    dsm363
    Official Tesla Gigafactory Discussion Thread

    The governor would have to call a special session I believe but don't see that happening. Of course if people find out they passed on a multi hundred million dollar factory just to satisfy the dealer lobby over 3,000 Teslas or so sold a year in Texas then that wouldn't make them look great.
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  • Feb 26, 2014
    ecarfan
    I think most of the balance of cell production will go into storage systems for PV installations, commercial and residential.
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  • Feb 26, 2014
    Aphysician
  • Feb 26, 2014
    dhanson865
    Texas north of Amarillo has good wind and solar.
    New Mexico east of that near I-40 is also very good for wind and solar
    Arizona and Nevada are more solar oriented (less wind) but maybe they can find a site with enough wind to make it worth it in one of those states.

    I can't imagine they'd want to mess with central or east texas due to shipping distances, congestion, and wind patterns.
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  • Feb 26, 2014
    Todd Burch
    This will also accelerate the drop in price of replacement packs for Model S/Roadster/X owners. 30% drop in price in just a few years...so anyone who prepaid for a new pack x years down the road probably didn't get as good a deal. Also means we'll likely see larger packs sooner rather than later.

    It also means Tesla will likely change the form factor of their battery packs (no more 18650s) so we'll probably see energy density/weight/size improvements come sooner with their own battery factory.
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  • Feb 26, 2014
    dsm363
    Why would they change the form factory of the cells at this point?
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  • Feb 26, 2014
    Aphysician
  • Feb 26, 2014
    aznt1217
    Just looked at the plans for the Giga factory... absolutely incredible. The American government has to be happy about this. Rural location + 6500 NEW jobs with potential to export. Furthermore, tech. companies HAVE to be interested, it can cut down logistics costs.

    Shouldn't be hard to get partners. Apple also uses a lot of things in the parts explosion and process flow diagram. This is going to be great. The fact that they are planning ahead for a serious Gen III production ramp, this should be a huge signal to the "haters" and competitors that Tesla is REALLY serious. Gen III isn't some dream, this is the first tangible sign for product execution.
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  • Feb 26, 2014
    tom66
    Apple's lithium polymer batteries need a pretty much completely different manufacturing process. However, there could be partnership for other companies, like SolarCity and HP/Dell/Lenovo/etc (who still use 18650s in their standard form factor batteries.)
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  • Feb 26, 2014
    Aphysician
  • Feb 26, 2014
    Aphysician
  • Feb 26, 2014
    Robert.Boston
    In the "resources" section the report does acknowledge that Bolivia has the world's largest potential, though certainly well below 80% of world resources.
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  • Feb 26, 2014
    TD1
    Elon mentioned a couple of times that 18650 is not the optimal size and mentioned a different size. I cant remember what it was.
    The point is that when they have the opportunity to setup whole new production lines they have the privilege to choose the optimal cell size.

    The only reason why they used 18650 so far was that it was the most common cell with the highest production capacity and therefore low price.
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  • Feb 26, 2014
    Todd Burch
    We know they use 18650s because they are prolific, mass-produced, and therefore cheaper. But maybe 18650 isn't the absolutely optimized form factor--it just provides the best overall value based on what's on the market. If they can shape the cell however they want, then perhaps they can create an improved form---improved in weight, size, energy density, or heat exchange properties.

    Edit: TD1 beat me to it.
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  • Feb 26, 2014
    tom66
    28650, 18350, 14650 are other sizes.

    28650 is fatter so makes more sense for energy density in a platform that is Model S/GenIII sized though I expect GenIII will still use 18650. As the batteries have greater volume to surface area, the packing density of the battery is improved. But cooling larger batteries is harder.

    18350 is a shorter form factor - might make sense in a GenIII Roadster vehicle as a floor mounted pack would add a lot of height to a sportscar.

    14650 is a smaller diameter battery - probably not much reason to choose this but it's an option. Easier to cool - could make sense in an ultra high performance vehicle (Tesla 1000hp supercar :D... one can dream...)

    Beauty of cylindrical li-ion is you only have to do minor retooling to make different sizes; you aren't constrained to 18650 only. Unlike with "pouch cell" form factor where the batteries are very different from one another.
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  • Feb 26, 2014
    Todd Burch
    My guess is that they will run simulations at different cell shapes and sizes with various usage patterns and create a form factor that is ideal and likely unique to Tesla.
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  • Feb 26, 2014
    Zythryn
    Didn't Elon say something at the 4th qtr call about Tesla would be using all the output of the factory?
    I don't expect any exporting unless we are talking about exporting to Tesla's Chinese factory :biggrin:
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  • Feb 26, 2014
    JPP
    I am a bit confused on lithium need/demand. At Teslive last year, Elon was asked about the supply/demand of lithium for batteries. He said that the lithium was 'the salt in the salad', implying that there actually was very little lithium in the battery. Of course a small amount per battery times billions of batteries is still a lot of lithium.

    Any chemists/raw materials experts out there who can provide commentary?
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  • Feb 26, 2014
    emupilot
    From the press release announcing the convertible note offering:

    The timing of the Morgan Stanley upgrade was certainly curious - could it have been based on non-public information? Is that kosher?
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  • Feb 26, 2014
    JRP3
    Lithium is about 4% of cell material by weight, about 2% of pack material by weight, so no, not much per pack.

    Looking at the materials chart I find it interesting that they are going to make the separator material on site, that one I wasn't sure about, but since it will probably be proprietary it makes sense. What I'm not clear on is they show "Raw materials" then "Copper Foil" and "Aluminum Foil", but I'd be surprised if they are making their own foil. I suppose they could be getting bulk rolls and then extruding it further into a thinner foil. They also show "Electrolyte Manufacturing" but don't list any inputs for that, so I don't know at what level they will be starting from. I would guess they would get the organic solvents and lithium salts, mix them together, plus their own proprietary additives.
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  • Feb 26, 2014
    gjunky
    Quote from the Tesla Investor page:
    The convertible senior notes due 2019 will be convertible into cash, shares of Tesla�s common stock, or a combination thereof, at Tesla�s election.
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  • Feb 26, 2014
    emupilot
    If the cell output is 35 GWh/yr and the pack output is 50 GWh/yr, that means they will get 15 GWh/yr from other suppliers like Panasonic and assemble them into packs at the Gigafactory. It sounds like that means they will be sticking with the 18650 format since they will need the externally supplied batteries to be as cheap as possible.

    I am skeptical they can finish the design of such a massive facility by the end of this year. I'm curious about contingency plans on cost and schedule - whether they can start producing battery packs without all the raw material processing etc. or how many Model E can be produced without the factory being online. Getting the Model X into production is a big challenge even with a battery supply and a shared platform with the Model S, but this is another order of magnitude entirely. Saving the world won't be easy - best of luck to Tesla! ;-)
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  • Feb 26, 2014
    austinEV
    isnt there a rule that the analysts cannot know what the dealmakers are doing? otherwise every report ever would be suspect.
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  • Feb 26, 2014
    airj1012
  • Feb 26, 2014
    aznt1217
    Yup. Separation. Nothing to worry about.

    - - - Updated - - -

    Exporting meaning to other assembly plants around the world. Or even cars that finally adopt Tesla tech, the batteries being modular and all... Tesla the car manufacturer AND OEM.
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  • Feb 26, 2014
    Hells
    If wonder if expandability is builty into the factory to accodomate tesla beyond 2025
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  • Feb 26, 2014
    jdevo2004
    Could potentially use a new size battery for packs that go into vehicles while the 18650 format from outside sources to go into solar power supply packs. Remember that multiple types of battery packs are going to be built there.
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  • Feb 26, 2014
    sleepyhead
    Yes, there is a Chinese Wall.

    Investment Bankers cannot communicate with research analysts and vice versa.

    Adam Jonas asked the question about capital raising and Elon confirmed they will raise capital this week.

    Adam wrote a bullish research note (maybe) in hopes to help his bank get a piece of the underwriting deal. And it worked.

    It doesn't take a genius to figure this out, and there is nothing illegal here. It would be very unethical if Adam didn't believe what he wrote. But if he truly believes in what he wrote, then there is nothing wrong with playing the game.

    Adam Jonas might get a nice bonus this year.

    And lastly the guys at zerohedge are idiots and always looking for conspiracy theories and other imminent market crashes that either aren't there or never materialize.
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  • Feb 26, 2014
    Theshadows
    Was there a conference call? If so is there a link to a recording?
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  • Feb 26, 2014
    tander
    No but Musk and Rive will likely be talking about it tomorrow at the CPUC event.
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  • Feb 26, 2014
    FluxCap
    The days after the 2008 crisis when I read Zerohedge got me depressed and questioning my own sound judgment, and then I realized the truth. Those are some seriously, perpetually unhappy people whose conversations inevitably devolve to "hoard canned goods, guns and gold bricks in your underground shelter, every other investment is futile."

    Agree with Sleepy, not worth paying much attention to.

    And on Adam Jonas' report -- research and investment divisions are walled off and regulated by SEC accordingly. Insider trading means jail time. This is normal, everyday stuff on Wall Street, and no cause for alarm. The shorts are desperate, and looking for any shred of negativity to come up with.

    GigaFactory is nothing less than the dawn of a new era for Tesla Motors, and perhaps even the US economy!
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  • Feb 26, 2014
    Citizen-T
    Nothing odd about a research analyst raising a price target after a fantastic quarterly report. Nothing strange about Morgan Stanley underwriting for Tesla. They always do. I'd say it's a coincidence, but it isn't really. The two events are tied to the earnings report, not to one another, hence their proximity.
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  • Feb 26, 2014
    ItsNotAboutTheMoney
    I can imagi e how it'll go:
    Elon Musk: When I was in college I thought about what would be the most important...
    Host: Hang on, can I just stop you there?
    Elon Musk: Sure.
    Host: Just cut to the chase. Gigafactory details.
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  • Feb 26, 2014
    Lloyd
    A recent article indicates that the 45% figures generally acknowledged were based on Li to 30 feet depth. Test cores were drilled in the resouce area and found Li to 600 feet! The problem is the general lack of water to extract the Li from the substrate. There are plans in place to divert water to this area to allow income and mining to this area. Political issues have delayed needed progress.
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  • Feb 26, 2014
    AlMc
    It will be very interesting to see what state gives the sweetheart deal here. I expect them to be falling over each other to try to get the first gigafactory that brings in 6,500 jobs.
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  • Feb 26, 2014
    TSLAopt
    I believe Rick Perry will be fighting tooth and nails to get this factory in Texas...will even offer some kind of credits from the Texas Fund they have set up for situations just like this. They may seem like the long shot to most people but that's the horse I'd put all my money on.
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  • Feb 26, 2014
    ecarfan
    I think Nevada is more likely. Texas doesn't deserve it after all the trouble the state has given Tesla.
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  • Feb 26, 2014
    ItsNotAboutTheMoney
    Maybe they'll build a very long, very thin factory that's in all 4 candidate states and get money from all of them.
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  • Feb 26, 2014
    TD1
    Im very surprised about that high number, I would think that most of the processes are completely automated.
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  • Feb 26, 2014
    ckessel
    Well, how many folks do you think all of today's existing battery factories employ? There's some economies of scale in colocating it all in one spot, but still, it's a massive factory :)

    As someone else noted, other manufacturers are going to have to get serious about building their own factories too, but even if they do, they'll be looking over scarce pickings for the top talent since Tesla will have sucked it all up.
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  • Feb 26, 2014
    bonnie
    100% automated factories still require people in purchasing, warehousing, process validation, equipment maintenance, facilities, EHS, HR, finance, quality, manufacturing engineering, and on and on and on. A facility that size will maintain their own wastewater treatment plant and lord knows what else.

    6500 doesn't seem high at all.
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  • Feb 26, 2014
    sleepyhead
    And don't forget that sleepyhead lives in Texas :wink:
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  • Feb 26, 2014
    FluxCap
    Stick it right outside Houston, on top of an old oil field. That would just be so sweet!
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  • Feb 26, 2014
    bonnie
    The only 'stick it' I'd like to see them do in Texas is to 1) get them to get rid of their antiquated dealership laws first, and then 2) pick another state.

    I'm still not happy with Texas legislators over that.
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  • Feb 26, 2014
    772
    Someone should make a gigafactory location poll for fun! My guess is New Mexico :smile:
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  • Feb 26, 2014
    apacheguy
    +1. Why the heck would Tesla want to benefit a state that has caused them so many problems?
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  • Feb 26, 2014
    FluxCap
    I guarantee you that if you dangle 6,500 new factory jobs at them, they will bend over backwards to toss the dealership laws out the window. Texas politicians like money and votes, and a little money from dealership PACs is nothing compared to delivering a giant factory to your state.
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  • Feb 26, 2014
    AudubonB
    On location:
    I think Texas would be a very amusing choice, given the recent history others have mentioned. Definitely a possibility.
    New Mexico's problem (am getting ready to be flamed here...) is that its educational system is so wretched that it might be difficult to find 6,500 willing able-bodied workers who could be properly trained.
    Arizona - if Gov. Brewer had not, 90 minutes ago, vetoed a certain bill, it was not only unlikely that Tesla would consider putting a plant here but there was a significant chance of fairly large-scale industrial exodus. In that she did veto it, well, AZ has a lot of the necessary elements.
    Nevada - I have enumerated elsewhere the potential extremely serious pitfall for any industrial firm cosidering setting up shop there. Other than those, it has some very interesting possibilities. Can its workforce throw up 6,500 workers????? If not, of course, they could be persuaded to there.
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  • Feb 26, 2014
    FluxCap
    1) Because cost/benefit ratios in the supply chain and other incentives will be the primary consideration in choosing which state gets the factory
    2) Tesla still has massive excess demand
    3) For the same reason Elon flew to Germany to personally announce European expansion, and stir the pot in the backyard of the big 3 German luxury brands. He likes showing no fear in the home turf of the competition.
    �
  • Feb 26, 2014
    sleepyhead
    I would build the plant in Austin, TX which is the biggest tech city outside of the Bay Area. You also have The University of Texas here that could help with research and send graduates to work at Tesla.

    I think it is a no-brainer decision to put it in or near Austin, TX. That is exactly what I would do.

    You then have your Headquarters in Silicon Valley and your battery plant in Austin, TX, which also happens to be the second city in the US with Google Fiber.

    Austin is by far the best place to build the plant. The tech talent out here is only second to the Bay Area.
    �
  • Feb 26, 2014
    FluxCap
    Now that is a fantastic idea. Still, not as snarky and fun as Houston maybe :). But maybe something like an oil field in La Grange, right in between them?
    �
  • Feb 26, 2014
    airj1012
  • Feb 26, 2014
    austinEV
    Plus me and Sleepy would go work there. Heck I will take a half salary, just add some options.
    �
  • Feb 26, 2014
    airj1012
    I really don't think that Tesla will be searching for college graduates for most of the 6.5K employees they need. I imagine this factory will essentially be in the middle of no where. With the size of the facility they need some cheap ground that is close the natural resources and also provides a good route back to Fremont, CA. My bet is NV or AZ.
    �
  • Feb 26, 2014
    sleepyhead
    It is not really about college students, that is just a bonus. It is more about being the biggest tech city outside of the Bay Area.
    �
  • Feb 26, 2014
    bonnie
    I'll hazard a guess that 'within a day's drive of Fremont' is high on the priority list - and I'll put my money on Arizona. (And there is a certain someone here who has already lost a bet to me regarding location...)
    �
  • Feb 26, 2014
    sleepyhead
    Yes.

    When they ask what I want for compensation, I will tell them that I want a very high number of very deep OTM options with similar vesting restrictions to what Elon Musk has in his options package.

    If they say, "how does $100k in salary and 1000 restricted shares sound?" I would say, "how about $80k and 10,000 options with $500 strike price that never expire?"
    �
  • Feb 26, 2014
    FluxCap
    Sign me up!

    - - - Updated - - -

    Very cool maps, thanks for sharing.
    �
  • Feb 26, 2014
    RobStark
    If they thought building the Gigafactory in a tech City offered a comparative advantage they would build it in Silicon Valley.

    Panasonic and suppliers have the manufacturing expertise and will probably bring employees from Japan to teach American employees.

    Reno is closest to Fremont of the cities in the area remaining in contention, has rail from Reno to Fremont, cheap land, good business climate and near new lithium mines.
    �
  • Feb 26, 2014
    AlMc
    :biggrin: What is the saying? ' It's not over till it's over'!! How many beers do I owe you now anyway?

    - - - Updated - - -


    I have a real problem with this!!! You won't be able to give out advice on TSLA movements. I will put in a call to Elon and nix that deal right away:biggrin:
    �
  • Feb 26, 2014
    sleepyhead
    I think that some people are underestimating the need for engineering and tech talent in such a battery factory. This is where all of the research will be done to advance battery technology I would assume.

    You can't just build a battery factory in the middle of nowhere and expect top talent to want to move to that city. Now, Reno is a nice big city, so it is definitely in the running. But Austin is one of the best cities to live in and Tesla as well could really benefit a ton from a place like Austin.
    �
  • Feb 26, 2014
    bonnie
    Awww, Sleepy ... I know you love Austin. Heck, I love Austin. But it's not the only city with a tech population. Intel has a huge presence, for instance, in Chandler, AZ. And they're in the middle of a cutback. That means a number of appropriately skilled employees available now.
    �
  • Feb 26, 2014
    austinEV
    Austin has lots of experience in the semiconductor fab world. Wouldn't be hard to transfer that experience.

    Seems like a proxy bidding war is breaking out :)
    �
  • Feb 26, 2014
    Causalien
    I never bet against Bonnie.

    On the location note. I think, based on the Taiwanese supplier's information releases to date, the most likely location is in Arizona as most of them have already announced plans to establish factories in Arizona. They did not mention Tesla in their release, but I find it suspicious that all of them all decided to setup a factory in Arizona within the last 3 months.
    �
  • Feb 26, 2014
    sleepyhead
    Awww, they have Intel... that's cute.

    I really don't care if the GF comes to Austin or not, because I would rather spend my time on TMC investing and trading TSLA rather than working for Tesla with trading restrictions.

    BTW, Austin has:

    Dell
    IBM
    APPLE
    AMD

    a bunch of semiconductor companies such as Freescale.

    and a lot of other tech companies such as Flextronics, National Instruments, or Sunpower.

    I think that Tesla is at least considering Austin right now; it probably will not win, but I would not count it out.
    �
  • Feb 26, 2014
    airj1012
    My vote is on Nevada. Close to Fremont and close to Wyoming which has the lithium. Can we set up a poll?
    �
  • Feb 26, 2014
    Cosmacelf
    :)

    Some blogs I read often link to Zerohedge, and when I click on such links, I go "Gawd, not another end of the world article."
    �
  • Feb 26, 2014
    GenIIIBuyer
    Hahaha, I have a large 100 oz silver paperweight at home due to a zerohedge reading binge a few years back. Would have been much more fruitful to buy 100 shares of TSLA..
    �
  • Feb 26, 2014
    airj1012
    I do not. They need cheap land. They're setting up a HUGE factory. Tesla needs 500-1000 acres for 10 million square feet. I HIGHLY doubt this factory will be in a major city. What other huge factors are in major cities? In comparison Fremont is only 5.4 million square feet.

    We're not hating on your city, but what you're offering isn't needed. Tesla needs LOTS of cheap land near natural resources (solar, wind, lithium) and highly accessible to Fremont. They human capital will move to the facility. They always do.
    �
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