The sound of robots humming fills the air at the Tesla factory in Fremont, CA.
By 2017, Tesla plans to build an electric car that is affordable to the every day person. The company’s plan is a $35,000 “third-generation” electric sedan with a 200-mile-plus range.
In addition, Tesla has adopted an aggressive business plan, hoping to be shipping 500,000 cars a year by 2020. This is more than 10 times its current output and they plan to do all this without federal subsidies that have helped make its vehicles more affordable so far.
How does Tesla plan on doing all this? The answer: Build a Gigafactory. In the next few weeks, the company will start building a massive, all-in-one battery factory in the American West. The factory will be capable of producing more lithium-ion batteries each year than were produced in the whole world in 2013. Through manufacturing efficiencies and obtaining bulk discounts on raw materials, such as nickel and cobalt, Tesla believes it can bring down the cost of its batteries by more than 30%, making a $35,000 third-generation sedan economically possible.
Tesla will still assemble the actual cars at their current factory in Fremont, which was bought in 2010 for $42 million from General Motors following their bankruptcy. In contrast, the Gigafactory will be built from scratch for an estimated $5 billion.
For a company that only sold 200,000 in 2013, this plan may seem crazy, but if Tesla pulls this off it will secure its place among the world’s big car companies, while helping to push electric cars into the mainstream.
Thomas Hsiao, President of SuperGreen Solutions Charlotte Mid-Atlantic Region, added, “We are very excited to hear that Tesla has come up with innovative ideas in order to make their electric cars more affordable to the everyday person. It is important for everyone to take action in becoming more sustainable and with companies, such as Tesla, making their products more economically feasible, we hope to see more people in our local communities and throughout the U.S. do their part in going green.”