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Tesla to Spend Over $770M on Texas Plant Expansion for Battery Cells and Manufacturing

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Tesla to Spend Over $770M on Texas Plant Expansion for Battery Cells and Manufacturing

Tesla (NASDAQ: TSLA) plans to spend more than $770 million on the expansion of its factory in Austin, Texas. January filings with the Texas Department of Licensing and Registration disclose the massive fund outlay. Per reports, Tesla plans to spend on constructing facilities geared towards testing battery cells and manufacturing. In addition, the prominent electric vehicle maker also intends to situate a drive unit manufacturing base, and a die shop, at the expanded site.

The planned Tesla Texas facility expansion would mark one of the company’s largest scale-ups since its German gigafactory move in 2022. Tesla officially opened its Texas EV and battery plant last April to a Cyber Rodeo opening grand party for stakeholders. The EV manufacturer currently produces its Model Y vehicles at the Austin gigafactory but is already experiencing some operational constraints. As it stands, the production lines at the facility command a small portion of its entire real estate. This predicament precipitated the need to expand, in addition to Tesla’s plans to manufacture Cybertrucks in the existing facility. Nonetheless, Tesla does not rule out onboarding more vehicle-line production initiatives at the Austin gigafactory down the stretch.

Phase Breakdown of Tesla Texas Expansion Initiative

The expansion would see an additional 1.4 million square feet of space added to the already imposing Texan site. The expansion scheme, broken down into four specific projects, should begin at the end of the month.

The largest of the four projects entails a 693,093-square-foot facility called Cell 1. This project is also the most expensive and would cost an estimated $368 million. According to reports, Cell 1 erection will begin on January 23rd and complete on February 12th next year.

The second-largest Texas expansion project is the Drive Unit planned to be 423,032 square feet. This initiative carries a price tag of $85 million and will begin on February 6th to end on January 15th, 2024.

The third-largest project by a square foot of 321,186 is “Cathode.” Although not as large as Cell 1 or Drive Unit, Cathode is the second most expensive at $260 million. Cathode has a start date of January 30th and will conclude at the end of the year on December 18th.

Cell Test Lab is the smallest of the expansion projects and has a run time of just six months. It will require an additional 2,560 square feet with an estimated cost of $3.7 million. Cell Test Lab will begin at the end of January and last till August 25th, 2023.

Despite the detailed project breakdown, some of these phases could supplement previous plans. For example, according to recent drone flyovers of the construction site, the Cathode plant’s construction is already underway.

Expansion Scheme Follows Zhu Promotion

Tesla’s Texas gigafactory expansion scheme comes on the heels of the promotion of its China boss. Last week, the EV company promoted Tom Zhu to the highest-profile executive role after Elon Musk. As Musk’s lieutenant, Zhu now has direct oversight over Tesla’s US assembly plants and sales operations in Europe and North America.

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Tesla to Spend Over $770M on Texas Plant Expansion for Battery Cells and Manufacturing

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