Has Giga Berlin hit volume production already? Before even delivering vehicles for a full month?
No of course not, that would be insane. No BEV manufacturer asides from Tesla has even hit
volume production, so how could Tesla ever be at volume production in just weeks. I know we
have a lot of theories about Tesla potentially sandbagging the output of these factories, and
accompanied with a bit of evidence too at times, but Berlin hitting volume production this early on
has got to be nonsense. It's going to take all year for Tesla to ramp up these new factories.
It took Shanghai about 8 months until it reached volume production with the Model Y,
so how could anyone possibly thinking that Tesla are close to volume production already.
Well according to the YouTuber Tobias Lindh,
has recorded Model Ys leaving the factory at a rate of one every 2 and half minutes.
Now that may not sound as fast as what we were told Berlin is capable of, with one Model Y at
every 45 seconds, but like I said it hasn't even been a month. Now for some reason some people
reporting on this, claim that this comes to 1,000 units a week. I am not quite sure how they are
arriving at that number. But if we don't include any downtime, the math works out different for me.
If there is one car every 2 and a half minutes, then that would come to 24 every hour. 60 divided
by 2.5 is 24. Then there are 24 hours a day, which would mean 576 vehicles a day. In a 30
day month then that would be a total of 17,280. Which ok, is slightly under volume production,
but still very close, and besides, once again, it hasn't been operational yet for a month.
Now obviously
this is not including down time, and assuming a 24 hour 7 day operation.
We don't know even know if Tesla have enough components to keep going at that
rate. But that doesn't concern me so much at the moment, I think look at the big picture,
the fact that Tesla were able to hit this level of production this quickly is just phenomenal.
Either way its actually somewhat moot as to how many total vehicles are coming off the line,
as we know there are other constraints at play as to how many vehicles Tesla can make.
What we really care about here, is how fast Tesla
have already increased their run rate at the new factory with the new processes.
Sure, Tesla have had several months to try and perfect the production line as much as they could
whilst they were waiting for approval to open the factory officially,
but I think Tesla only produced about 300 test Model Ys in that period,
of which they are supposedly not allowed to sell either. That's not a lot of testing.
There are also reports of panel gaps in the new Berlin models,
this is something that can occur when Tesla are ramping up their production speed. Wow,
I am probably the only person who can spin panel gaps into a positive.
We are told
that the chip shortages are going to create constraints in production,
but we don't really know to what level this applies, as we have not been told how many cars
Tesla have enough chips for this year. We can however get a rough idea of how many batteries
Berlin might have available. Berlin appears to still be only producing the Model Y Performance,
and perhaps they will eventually start producing the long range version there too.
Either way, the two models both use 2170 batteries, and the same battery pack size.
The batteries are coming from LG in Korea, and I would guess that they supply around 20 GWh/yr.
That would be enough batteries for almost exactly 20,000 Model Ys a month.
So if Tesla cam reach volume production there should be enough batteries available.
We were told by Elon that Berlin wouldn't
hit volume production until the end of the year. This is a massive discrepancy. And ok, it's not as
if Tesla actually have made this many cars in a month yet, but the fact they it may already
be possible is mind blowing. Maybe they can actually hit volume production next month though.
Hitting volume production is important, it's how you achieve economies of scale, and aside from
getting battery costs down, is the other major element for making a profit manufacturing EVs.
Obviously aside from not having unions or car dealerships too, all of that also heavily reduces
any chance for a BEV company to make a profit too. Fortunately for us, that's not the case with
Tesla. This Berlin facility is not going to be the cheapest to run,
especially given how much power costs in Germany too. There is a lot of capex to recover in this
building. If you can make twice as many cars from the same factory, then those costs remain
the same, and and become half as much per vehicle produced. This is just another reason
as to why volume production is so important, especially when you have massive overheads.
It would appear all the competition have even larger capex expenses, higher running costs,
and of course can't hit volume production. It's a real dilemma for them. Yea, we really don't
need to worry about the competition overly. I mainly just like to research them these days
to get an idea of just how far ahead Tesla is, and how truly incredible their engineering is.
Rather than researching the competition as to whether they have a chance of catching up
to Tesla. They don't, and with factories and new processes like this, they have even less.
Some people think I am being arrogant, or complacent, or just a delusional fanboy, but this
is what all the research tells me. But I'm sure I'll get the odd comment of something like someone
informing me that the Hyundai Ioniq 5 costs less than the Model Y, as if it means something.
Surely Tesla have learned
so much from Shanghai that we would have expected this factory to have ramped up a lot faster due to
all this extra experience they now have. But not only that, we have new manufacturing techniques,
well mainly the front die cast mold. It doesn't appear that they are using the cell to vehicle
integration in Berlin yet. But still just the front mold is saving about another
300 robots or so, and so many additional processes and parts. It makes a difference.
Also Tesla no doubt learned everything they could from Chinese manufacturing,
including setting up a lab to research further. Well the Germans also have a lot to offer in the
way of manufacturing and engineering too, and especially when it comes to vehicles. Tesla are
able collaborate on all the knowledge of each nation on manufacturing and take the best of it
all. It would be amazing if they got to learn from Japan one day too, and set up a factory there.
So are we once again being
sandbagged? What sort of speed could we actually expect these vehicles to come off the line,
with all the new manufacturing processes? We have witnessed them come off the line in
Shanghai in just over half a minute. Shouldn't we expect this even more state of the art facility
to be even faster? I would. Then what does that mean for the capacity? Well I have done models
comparing it with the Shanghai Model Y facility, and estimate between 1.5 and 2m in the existing
fab alone. Sure this may not be until we are manufacturing with 4680 structural battery packs.
I know the most important thing in Tesla's future is the progress we get with the 4680 batteries,
but it's also interesting to see the level as to which Tesla are capable of ramping
up these new factories. I do keep saying that Tesla are not manufacturing constrained, they
are battery and chip constrained, and hopefully just battery constrained by the end of this year.
This is also the same for Shanghai,
it's not great that we are hearing that Shanghai might now be shut down for almost half of April.
But will this affect Tesla's production for the year? Well if they are still making chips,
then when they re-open there's a good chance Tesla can ramp up their production faster to pick up the
slack. However, it's also likely that CATL's new battery factory is not operational either,
which means Tesla will have fewer batteries available. Although it might not make much
difference due to the chip bottleneck, in the long run, fewer batteries will also mean fewer vehicles
made. However, some of these spare components may well be able to be used in Berlin now too.
It really is great having multiple factories in different locations for diversification.
All of this is hopefully quite inconsequential as soon as the global battery supply becomes dwarfed
by the rate at which Tesla can produce 4680 batteries.
I don't make videos
like this to try and pump the stock, it's more me trying to investigate what is actually happening
in the company, as I feel there is somewhat of a disconnect between what we are told,
and what Tesla are actually doing. We have seen it and witnessed it in the past, I am not just
making things up. I feel like Elon is keeping his cards close to his chest at the moment,
I am merely trying to take a peak as best I could, and I think I might have spotted an Ace.
Either way, if Tesla have hit a run rate of a new car every 2 and half minutes already,
then it absolutely mind blowing, even if they only maintained that rate temporarily,
it's still an incredible sign. Just imagine if they are also able to produce 4680 batteries at
insane rates to match their vehicle manufacturing. The numbers aren't add up everywhere. I think I
have a theory on how to estimate the run rate of the 4680 factory in Texas too.
I just need to wait until I feel better, I swear I feel like I dropped about 20 IQ points lately,
can't wait to get back to normal and start doing some serious financials.