Tesla Motors Inc (TSLA) Giga Factory Is Crucial To Auto Maker’s Future

Updated on

Tesla Motors Inc (NASDAQ:TSLA) is banking their future on a possible Giga Factory. The auto maker’s chief executive officer Elon Musk mentioned a little bit about it during a third-quarter earnings call.

Tesla’s supply constraints are a problem

A Giga Factory would increase the number of lithium batteries and cells. The one problem during Tesla Motors Inc (NASDAQ:TSLA)’s fourth quarter guidance was the supply constraints. Tesla was still able to deliver 6,900 Model S units during the fourth quarter.

Musk didn’t go into too many details about . He explained, “It’s going to have essentially zero emissions and there are no toxic elements that are going to come out of this factory and we will build in recycling capability right into the factory. So old packs would come in one side and get reprocessed as new packs. So a way to think of this is like a factory is the machine that works for machine and that itself has a version, just like you have a version of a product. It’s like a version of the factory. So we are trying to figure out what’s the right way to do version one at this giga factory and we want to be thoughtful about it and it is going to be a really giant facility, like say we are doing that something that’s comparable to all lithium-ion production in the world in one factory.”

Other analysts see the need for Tesla giga factory

Such a factory could be vital to the car maker’s success and future, especially if the company wants to grow in the electric car market. Last month, one analyst for Morgan Stanley (NYSE:MS) claimed a giga factory could help steer Tesla Motors Inc (NASDAQ:TSLA) into a new frontier. It could also allow the company to go beyond just automotive manufacturing. Adam Jonas believes Tesla could establish a lead in technology and scale.

We’re still waiting to hear more about a possible giga factory.

Leave a Comment