Tesla Selects Nevada for Gigafactory Battery Plant – But Can They Deliver?

The worst-kept secret in years … Tesla selects a Nevada site near Reno to build their battery factory.

The key questions that the battery and car analysts are raising among all of the excitement, include:

1. Will the factory get the cost of the car batteries low enough so that Tesla can actually price its Model III near the $40,000 range that is being promised. Many analysts are saying no.

Rendering of the Tesla Gigafactory to be built near Reno, Nevada
Rendering of the Tesla Gigafactory to be built near Reno, Nevada

2. Will the plant be built and operating by 2017 and in time to launch the Model III that year?

3. And finally, Tesla is saying by 2020, the factory will be able to produce enough batteries for production of 500,000 Teslas. To achieve this goal, and assuming the company means EVs with their branding, as opposed to also including platforms made for other brands, in 2020 they would likely have to sell:

– 300,000 Model III
– 100,000 Model X
– 100,000 Model S

While not impossible, especially with the growth opportunity in China, by comparison BMW sold 294,000 3 Series sedans in all of 2012. So the Model III, which Elon Musk has said is targeting the 3 Series and Audi A4, would have to match that volume.

What do you think, can they reach this level of sales in roughly 6 more years?

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