Tesla has brought online a massive $US5-billion lithium-ion battery factory in Nevada — the Gigafactory.
The company formed a partnership with Panasonic to get the facility up and running. CEO Elon Musk says that other sites for additional Gigafactories are in the picture.
The Nevada Gigafactory is called “Gigafactory 1.” Future Gigafactories will likely be located in other countries, and their could be half a dozen of them.
Way back in 2014, Tesla outlined how the Gigafactory might work. In a letter to investors, wrote: “Processed ore from mines will enter by railcar on one side and finished battery packs will exit on the other.”
Anyone who knows the history of the auto industry will recognise in that description a possible reference to Ford’s River Rouge plant, a sprawling facility that for decades symbolized the might of the US auto industry and the virtues of “vertical integration” in manufacturing. This is a simplification, but for all practical purposes iron ore went in one end and finished cars rolled out the other. Everything required to build an automobile was on-site.
The gargantuan plant operated until 2004.
Tesla’s ambitions for the Gigafactory are huge. It’s been noted by industry observers that if the company succeeds in building 500,000 vehicles per year, there won’t be enough lithium-ion batteries in the world to supply its needs. So Musk and his team must build the battery capacity that the globe currently lacks.
As Tesla strives to increase production to 500,000 vehicles annually by 2018, Musk has begun to stress that more vertical integration is the way forward for the car maker. This runs counter to a multi-decade trend in the auto industry, where so-called “lean” or “just in time” manufacturing has been the preferred operational mode.
Check out these images and stats from the River Rouge factory (they’re from an old film that’s on YouTube — it’s worth watching but, at a half an hour in length, is a bit too long to embed here).
The factory was literally located on a river — the Rouge River in Dearborn, Mich., where Ford still has its HQ.
It consisted of nearly 100 buildings.
That many structures required a lot of glass, to provide light and ventilation!
Materials were moved in and around the plant by a vast network of railroad tracks.
It goes without saying that the symbol of America’s industrial age was a major employer in Michigan.
But in many places, those employees were dwarfed by the plant’s impressive machinery.
Get the latest Ford stock price here.