By on July 14, 2021

Despite achieving a miraculous global expansion in a period where established industrial conglomerates and regulatory hurdles make it nearly impossible for new automakers to persist, Tesla’s German facility is running behind schedule. Production at the Gruenheide plant (aka Giga Berlin or Gigafactory 4) was originally planned to commence this month, with deliveries kicking off shortly thereafter. But those targets have been shifted closer to the end of this year or the more likely scenario of early 2022.

As Tesla would still like to supply the market, its facility in Shanghai will begin shipping vehicles to Europe in August until local production can be achieved. Model Y crossovers will be imported from China until its German site has its assembly lines humming, which has turned out to be a harder task than the automaker anticipated. 

Tesla CEO Elon Musk has repeatedly criticized bureaucratic hang-ups in California, citing them as the reason why he’s shifting much of the business to Texas. Germany has also garnered complaints, with Musk noting that regulatory issues were causing numerous delays in getting its Gruenheide plant operational. Building permits have been repeatedly delayed after environmentalists wanted to protect the forested area the build site was located upon, with claims that setting up a factory would harm endangered animal populations. The company also had a row with its water supplier over allegations that it had not been paying the Strausberg-Erkner water association, something that later turned out to be a miscommunication.

But it’s been issues like these that have stalled progress and ultimately forced Model Ys to come in from China, according to the latest from Automotive News:

Tesla has faced a series of setbacks to opening its German factory, with Musk expressing dissatisfaction with the complex regulation and red tape tangling up the opening of the plant.

The U.S. automaker wants to produce around 500,000 Model Y and Model 3 cars annually in Gruenheide. The company still lacks the final environmental permit for the construction.

Officials from Brandenburg state, where the plant is located, said last week that Tesla had constructed tanks on the site without approval and said they were preparing to fine the automaker.

German news outlets have cited the company as confirming it will still begin delivering vehicles (specifically the Chinese-made crossovers) next month. But the local facility is still supposed to become Europe’s primary sourcing point for Model Y EVs and the necessary batteries once it’s been completed. Unfortunately, the timeline for when remains flexible. Despite having made a substantial amount of headway on the factory already, German authorities have stated that the company will not be able to utilize the aforementioned tanks (and several other structures) it allegedly built without the proper permissions. However, that’s likely to be settled once Tesla drops a sack full of money onto the desk of whatever government agencies need to be reminded of the company’s commitment to the region.

That doesn’t mean conditions are better in China, however. Tesla has been subjected to large (sometimes suspect) recalls in the region and what looks to have been a prolonged smear campaign over allegations that its cars were poorly built and could be used to help foreign entities spy on the Chinese military. Alleged Tesla customers also protested the company the Shanghai Auto Show this year, with several regulatory bodies investigating the quality of locally produced models. Many have argued these moves were political, with state-run media intentionally trying to bully an American company that recently finished a large, technologically advanced production site inside of China.

[Image: Jag_cz/Shutterstock]

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11 Comments on “Tesla’s German Factory Needs Help From Shanghai...”


  • avatar
    SCE to AUX

    Giga Shanghai set the bar very high, producing cars only 11 months after groundbreaking.

    Giga Berlin only broke ground around June 1, 2020. That they are so close to production is amazing. Heck, my local Dairy Queen was offline for 18 months for just a facelift, and that was pre-Covid.

    I’d imagine China and Germany differ *just a little* on regulatory construction requirements and permitting. But I’m surprised Tesla’s planners aren’t doing a better job clearing the path for construction at Giga Berlin. Disputes over un-permitted water tanks seem totally avoidable.

    Tesla’s fortunes have waned a bit in China lately, so they may have excess capacity for the European market.

    • 0 avatar
      FerrariLaFerrariFace

      “Giga Shanghai set the bar very high, producing cars only 11 months after groundbreaking.”

      It’s amazing what one can accomplish with an endless supply of slave labor and a blatant disregard for worker safety, build quality, and environmental impact.

      • 0 avatar
        FreedMike

        Yep, pretty much this. I’ve often wondered what will happen when the Chinese people wake up to the fact that they don’t actually have to put up with this kind of BS. Regime change with a billion p*ssed off folks behind it might be fascinating to watch.

        • 0 avatar
          Kushe

          Why do people; especially Americans have this misconception about China? They always think the Chinese people are unhappy with their government. Please read this excerpt from this article https://www.politico.com/newsletters/politico-china-watcher/2021/07/01/after-100-years-chinas-communist-party-remains-a-black-box-493433

          *It’s not clear that Chinese people under the age of 40 know about this bloody history or think it matters. They focus on their own prospects, which are far better than their parents’ and inestimably brighter than the violence and privation that their grandparents endured. Most young Chinese people seem to view the CCP as inevitable, irreplaceable, and as deserving of gratitude for bringing China from medieval poverty to global economic and technological prominence in the course of a single lifetime.

          This intimate connection between China, party and people is poorly understood in Washington. Former Vice President Mike Pence and Secretary of State Mike Pompeo spoke of the Chinese people as “enslaved” or “imprisoned.” In a 2020 speech, Pompeo implied that the U.S. might inspire the Chinese to rise up against the CCP and establish the democracy they desperately desired.

          This good people/evil government thesis has a long history and many adherents in the U.S. It’s a delusion. There are thousands of brave dissidents and free thinkers in the PRC, but there is greater unity of purpose between China’s rulers and their 1.4 billion subjects than Americans usually admit. If it were a nation of evil emperors and captive masses who secretly agree with us, China would be relatively easy to deal with. It isn’t. China is a complex, ambitious, aggrieved nation — a government and a people. It will believe what it believes and do what it does regardless of our wishes. This relative unity of purpose is one of the major themes of the centenary.

          Unity does not mean the people are always passive, however. The Chinese expect the party to address their changing needs. Young people defy government exhortations by marrying later and having fewer children; the elderly push back against government demands that they delay retirement; white-collar urbanites decry long hours and advocate for digital privacy; young people give up on the rat race altogether by “lying flat”; and women fight sexual harassment and patriarchal culture through street protests, stand-up comedy and rock ballads.

          China is not ripe for revolution. Its people report high rates of satisfaction with their improving lives. They are not demanding Western-style human rights, but they are asking that China be more humane. The lesson for the United States is that China is still changing. Washington can’t direct that change, but it should understand and respond to it through continued engagement. Calling the Chinese people “slaves” and “prisoners” when most of them seem to feel more enabled than constrained by their government will not win them over.*

          • 0 avatar
            NN

            This is a sober and accurate view of China, based on my experience as well (having lived there and having many contacts there). A friend who is a psychologist once told me “low expectations are the key to happiness.” The gains in quality of life for people in China in the 18 years since I lived there are ridiculous, especially when compared to prior generations. With some glaring exceptions (Hong Kong, Xinjiang Uyghur) life is improving dramatically for the masses. As long as new infrastructure that puts the US to shame continues to come, as long as job prospects continue, as long as more mouths are fed and nicer cars are bought, there will be no revolution. That’s why anyone from Hong Kong who values their traditional freedoms is leaving for the UK

  • avatar
    indi500fan

    What’s the opinion of Chinese built vehicles from the German consumer?
    And are the Chinese Teslas better quality than the Fremont ones?

    • 0 avatar
      mcs

      I’ve seen reports that the Chinese made vehicles were better than Fremont. There are even some advantages to the Lithium-iron batteries as well. It’ll be interesting to see what the quality will be from the Austin plant. My bet would be that their quality will be first-rate once they iron out any startup issues.

      • 0 avatar
        FreedMike

        I have no confidence whatsoever that Tesla’s quality will ever be first rate unless a) they’re bought by Toyota, or b) they hire whoever’s in charge of quality at Toyota.

        • 0 avatar
          mcs

          @FreedMike: IT’s not about who you hire for QA. That won’t solve the problem. When there are production numbers to meet and they’re pushing the line to the limit, there will be QA problems.That comes from family members that were manufacturing engineers and my own early career experience in auto plant automation. Any time there was a production push, that’s when I’d hear Sunday dinner table complaints about quality being ignored. My own experience was from witnessing what happened when the line was sped up. Even got told to forget about it when I once ran down to final with a list of cars we screwed up. “Let the dealer take care of it.” I think Tesla will eventually have really great quality, but they won’t be 100% as long as they have the backlogs and production pushes. When I read about those end of quarter production pushes, I cringe.

          At least Tesla is getting the quality right for the most part with the batteries. Can’t say that for GM and Hyundai and the Lucky Goldstar battery company. I’m fine with Tesla, CATL, Panasonic, and SK batteries, but want nothing to do with LG because of the quality issues.

          One thing I’m planning on is getting a post purchase inspection by the Tesla independent shop near me to see if they spot anything. The body I’ll check myself.

  • avatar
    Lorenzo

    Why in the world did they choose to build their factory in (formerly East) Germany? Between the strict environmental regulations, the strong unions, and a punitive legal system that was on display against VW, it would compare unfavorably to a number of other European countries.

    • 0 avatar
      NN

      Because the hard way is the right way. Germany is the 800lb gorilla of the European market. They will get through the regulatory headaches. Build in Germany to convince/sell to German customers who are pretty nationalistic in their automotive tastes. Once you do that, most anyone else in Europe will buy your cars.

      Look at German sales for June 2021, Tesla Model 3 is only non-German passenger vehicle (non-commercial) in top 10 sales rankings

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