A new Tesla Inc’s auto factory to serve the European market will be based in Germany, chief executive Elon Musk said on Tuesday.
Musk said during a ceremony at Germany’s Golden Steering Wheel awards that the new “Gigafactory” would be “in the Berlin area.”
The company planned the facility “near the new airport” in Berlin and Tesla would also set up a design center in the area, he added.
“Everyone knows that German engineering is outstanding and that’s part of the reason we are locating our Gigafactory Europe in Germany,” he said on stage.
“We are also going to create an engineering and design center in Berlin, because I think Berlin has some of the best art in the world,” he said.
The news highlights a further global expansion for the electric vehicle maker, which last month said its factory in China had started production.
Musk offered few details, but reports have said Tesla hopes to start European production by 2021.
“Giga Berlin,” he tweeted, bookending the words with heart emojis.
“Will build batteries, powertrains & vehicles, starting with Model Y,” he said in another tweet.
Tesla is estimated to have about 30 percent of the European market for battery-powered cars.
Musk’s announcement is good news for the German auto industry, said Ferdinand Dudenhoeffer, a professor at the Center for Automotive Research at the University of Duisburg-Essen.
Tesla producing electric vehicles in Germany could wave a checkered flag at the local competition, such as Volkswagen AG, BMW AG and Daimler AG, speeding up innovation in the sector there, Dudenhoeffer said.
Tesla last month said that it posted a profit last quarter instead of a loss as analysts expected.
It said it is producing vehicles “on a trial basis” at its new opened “Gigafactory” in Shanghai, which should help boost global production and sales.
Musk was optimistic that the Shanghai factory could begin cranking out Model Y vehicles by the middle of next year, and believed the new model has the potential to be a huge seller.
He expected the Shanghai factory to hit “volume production” in a few months, and that it could be possible to significantly ramp up Tesla production.
A battery plant is also being built on the Chinese site, he said.
Tesla’s first “Gigafactory” was constructed in Nevada, and its vehicles are built mostly at a factory in Northern California.
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