Tesla Motors has announced plans to build a factory that will drastically reduce fuel-cell costs and ultimately produce more lithium-ion batteries per year than the total amount currently produced worldwide.
The announcement to build a 500- to 1000-acre “Gigafactory” came just a day after Consumer Reports named the Tesla Model S the Best Car of the Year. Stock shares since then have risen roughly 20%, giving Tesla a market value of more than $31 billion.
“It … 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,” Tesla executives said in a written statement about the facility. “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.”
Along with its partners the company said it will spend between $4- and $5 billion on the factory through the year 2020, with Tesla directly investing roughly half of that sum. The idea is to employ 6,500 people there and produce 500,000 Tesla vehicles by 2020, which will be a boon considering the fact the company has struggled to keep up with production demands.
Hawthorne, Calif.-based Tesla has not announced a location yet but finalists include locations in Arizona, Nevada, New Mexico and Texas.
Click here to see some diagrams of the proposed factory.
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