Tesla's European Battery Production Location Confirmed By Brandenburg Minister Of Economics And Energy

On the second-quarter earnings call, Elon Musk revealed Tesla Inc TSLA will be producing battery cells locally for Gigafactory Berlin, which is expected to produce Model Y and Model 3 vehicles.

Now, a report from Tesmanian, sourcing German publication Der Tagesspiegel, says the batteries will be produced in Grünheide, a municipality of Germany.

“Tesla has started planning for a battery cell production in Grünheide. The company told us about it. This is great news again. Another step to make Brandenburg the leading energy transition country in Germany and Europe," said Jörg Steinbach, President of the Technical University of Berlin.

Tesla's plan is to ramp battery production in tandem with car production, so all batteries can be produced locally. Batteries have been a bottleneck of vehicle production for Tesla in the past, and it seems the company wants to avoid that for the European factory going forward.

Benzinga's Take: Grünheide is where Gigafactory Berlin is currently being built, so it makes sense Tesla will produce batteries close to the factory. Perhaps Tesla will have room to produce vehicles and batteries all within Gigafactory Berlin.

Tesla aims for as much verticle integration as possible, and we're seeing that here. If Tesla can build this factory as fast as the Shanghai Gigafactory, Europe could have locally built Teslas to purchase in less than a year.