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Tesla to Invest $3.6 Billion for Gigafactory Nevada’s Phase Two, Semi Production

Elon Musk began by thanking the employees of Gigafactory Nevada on their work since it opened officially in 2016. “This factory has made a massive effect on transitioning the world to sustainable energy,” said Musk, “and it’s something you should be incredibly proud of and I’m incredibly proud of you guys for doing it.” Tesla then showed a video on Giga Nevada’s transition from barren ground in 2014 to a fully functional facility as it stands today. He then went on to explain that while its current production of drive units, battery cells and packs, and stationary storage is what made it, he indicated that “there’s more.”

Phase One Results

Before moving on to the future of Giga Nevada, Musk showed that global production of lithium-ion battery cells has nearly doubled between 2010 and 2013 and going from just over 20 GWh/yr to over 30 GWh/yr but Tesla’s goal of nearly 35 GWh/yr was seen as a “crazy amount of batteries to make,” according to Musk, and set up to create more batteries “than the rest of the world combined.”

As it currently stands, Giga Nevada is still the largest battery factory in the U.S. producing more than 37 GWh/yr (or about 7.3 billion Panasonic battery cells), according to Tesla. All of this is the result of $6.2 billion dollars of investment on a 5.4 million square feet facility (3,200 acres in total) with 11,000 employees that come from the state of Nevada.

Even more impressive than its total energy output from the cells is the amount of units those batteries create. During the update, Musk showed that Giga Nevada produced 1.5 million battery packs for its vehicles and 1 million energy modules for its stationary storage (home, business, and grid-level Megapack energy storage packs) division (that’s over 14 GWh, according to Tesla).

Phase Two is Set to Begin

Musk also announced a new investment for Giga Nevada and showed off what the next phase of the factory will look like. It’s a $3.6-billion dollar (estimated) investment that will add 4 million square feet to Giga Nevada along with 3,000 new jobs directly tied to the plant. However, Musk admitted that Tesla expects to exceed those estimations. He then showed just how it will be laid out with its current footprint, the new 4680 cell factory, and the Semi production factory along with its redesigned entrance.

The new 4680 Factory expected to hit 100 GWh production to begin with when up and running at Giga Nevada. Long-term expectation is 1,000 GWh/yr production or “possibly 2,000 to 3,000” GWh/yr of 4680 batteries, Tesla claims. It’s a staggering number when you consider the low estimate is nearly 30 times current production while Musk’s 3,000 GWh/yr is just over 81 percent more. “This really is just the start,” said Musk, and added that it will be “the equivalent” of “1.5 million additional Model 3/Y vehicles.”

He then explained that the 4680 will be used for Tesla’s stationary storage packs, as well as noting that all of those estimations are in addition to what their current suppliers are producing. The total number of 4680 battery production by Tesla and other 4680 producers is what Musk estimates is needed for replacing fossil fuel energy and transportation production with sustainable energy using wind, solar, and stationary battery energy. “It’s actually a really incredible thing to think about and, yeah, some people have said this was impossible, but you can drive it,” said Musk, as the video of High-Volume Semi Manufacturing popped up.

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“This year is kind of like the limited production of the Semi truck,” said Musk, who then explained that “sometime next year” Tesla will hit high-volume production for its Semi. Musk also talked about how, despite being one percent of all vehicles on the road, diesel semi trucks account for 20 percent of all emissions. “It’s a much bigger effect than you think if you look at the number of vehicles,” said Musk, “It’s an essential part of the sustainable energy future.” He also made this point during the Semi truck’s delivery presentation to Pepsico.

The Nevada Governor Speaks, but Doesn’t Offer Promises of Incentives

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Nevada Governor Joe Lombardo also joined Musk on stage during the presentation. “I want to thank Elon for helping improve your quality of life, my quality of life, and changing the world,” Governor Lombardo started. In a rare show of humbleness, Musk reduced his impact by saying, “Just to be clear, I get way too much credit,” then gestured to the Giga Nevada workers present and said, “The credit is theirs.”

Governor Lombardo first talked about his State of the State address from the night before where he mentioned the $3.5-billion investment Tesla is making to expand Giga Nevada. In that address, Governor Lombardo didn’t address if the state would offer any additional tax breaks or incentives for Tesla to help with the expansion—though, his address did touch on cutting taxes for Nevada residents—but talked about how the state of Nevada will work with Tesla.

“What is my role in this process?” Lombardo addressed the crowd, “While Elon’s here to change the world, I’m here to change your life.” Governor Lombardo then spoke about Musk’s “three pillars with electric energy.” “You’ve got the EVs, you’ve got the storage, and you’ve got wind and solar,” said Lombardo, “My three pillars as your (Nevada’s) Governor is the economy, education, and your quality of life/public safety.”

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“The economic driver is obviously Tesla and its changing the environment and your lives and Nevada’s lives with your placement here in the state of Nevada,” said Lombardo, “And now, today, with this expansion, it’s even going to double the quality of life and the economic engine and the drivers for us to be successful in the whole state of Nevada, in particular to northern Nevada.”

Governor Lombardo would go on to introduce his Director of the Governor’s Office of Economic Development, Tom Burns. Burns was formerly a part of the Vegas Chamber as well as a member of a commercial insurance firm in the state, Cragin and Pike. “He is the one who is instrumental in partnering with Tesla to ensure that we get this project off the ground and built, and ensuring that it goes into perpetuity into the future,” said Governor Lombardo. Unfortunately, neither Governor Lombardo or Burns would explicitly explain what that would mean during the event. Nevada and Tesla employees will continue to wait and see just what breaks and help the state will offer, if any.

Other than that, Lombardo would introduce Former Nevada Governor, Brian Sandoval—who had a “handshake agreement” to build Giga Nevada back in 2014—as well as Tracy Larkin-Thomason, the director of the Nevada Department of Transportation (NDOT), where Lombardo declared that her primary task was to expand and make the I-80 safer to drive on and “to ensure that Semi truck get on the road and gets out of here.” To close, Governor Lombardo stated that he hopes “to continue this partnership into the future and ensure that we have a very, very long term relationship” with Tesla and Giga Nevada and that “everybody gets to be friends.”

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