Tesla Gigafactory: the Potemkin village looks more like a burgeoning city as workers start production

The Gigafactory 1 in the Nevada desert is central to Tesla’s strategy. It’s seen among supporters as Tesla’s main advantage by securing low-cost battery supply that will enable ramping up production of long-range and affordable electric vehicles.

But it’s seen by detractors as a Potemkin village – no more than an empty shell with little chance of ever seeing any significant production of battery cells.

The Potemkin village theory, which has been pushed by people with short interest in Tesla’s stock, is losing credibility fast as Tesla and Panasonic are starting to ramp up production at the plant.

The factory is now producing battery cells, Powerwalls, and Powerpacks.

Tesla says that it already employs over 1,000 full-time employees at the plant and that’s without accounting for construction workers and Panasonic’s own employees for the battery cell production.

But the detractors behind the Potemkin village theory rarely believe what Tesla is saying and they want proof.

A new sourcer at the Gigafactory, Wendy Scott, posted a picture of the parking lot of the plant this week and it showed around 1,000 cars – all representing people at work:

Update: the picture was removed from Scott’s Instagram, but it’s the same as the one featured above.

https://www.instagram.com/p/BQTi7ebAYw-/?hl=en

Ultimately, the Gigafactory need to employ over 6,500 people under its deal with the state of Nevada, but the company sees a potential for as many as 10,000 employees following their updated plan to produce 150 GWh of battery capacity at full production in 2020.

Both Tesla and Panasonic are ramping up hiring at the plant as production ramps up to support current battery production for stationary energy storage, but also the expected start of cell production for the Model 3.

We could get to see the true value of the Gigafactory this year and going into 2018.

Tesla plans to ramp up production throughout the year in order to hit an annual rate of 35 GWh of battery cell production and 50 GWh of total battery pack production in 2018.

At a rough estimate of $150 per kWh, it would achieve an annualized product output worth $7.5 billion at that point.

As we reported last week, the Gigafactory reached just over $1 billion in construction costs based on accumulated building permits.

The biggest remaining unknown at this point is the actual battery cell that is being manufactured at the plant. Tesla CEO Elon Musk has been boasting about the new cell over the past few month. He said that it’s the “highest energy density cell in the world and also the cheapest”, but the company has so far refused to confirm any specific detail about it – other than its new ‘2170’ format.

That might change soon as Powerpacks and Powerwalls are being delivered with a version of the new cell and an upcoming event for the final unveil of the Model 3 should bring more information about this essential new product by Tesla and Panasonic.