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Tesla plans to build a new car factory in Texas

144 points| rbanffy | 5 years ago |arstechnica.com

155 comments

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[+] IfOnlyYouKnew|5 years ago|reply
Isn't this just Elon Musk getting into one of his superfluous fights, only this time California being the somewhat-random opponent? Musk has been completely unhinged the last few weeks, and it doesn't seem to be wise making such large decisions in anger, especially considering the reason for his anger is, even if justified, unlikely to reoccur.

I'm quite the Musk fanboy, but he's always had this very strange anger issue... It's not even getting in fights that I find troubling. But for the genius that he is, these squabbles just seem...pedestrian? Calling people pedophiles or going five rounds with SEC for no reason at all?

For comparison, I hate Peter Thiel with a passion. But finding some plaintiff and funding the lawsuit that bankrupts the news organisation that wronged you, for something entirely different? That's how you should win stupid fights when your day job is rockets, fire-throwers, and revolutionary sports cars.

If his recent "red pill" comments is a sign of what's to come, he might be stretching his luck. Going full alt-right MAGA is going to cut his customer base in half, at least in the US and Europe.

[+] sangnoir|5 years ago|reply
> Going full alt-right MAGA is going to cut his customer base in half, at least in the US and Europe.

Putting my best effort to be charitable here: he could be opening up a whole new market that is opposed to tree-huggers, fuel efficiency and Priuses. Texas loves trucks, the Cybertruck will be henceforth known as the Freedom Cybertruck and the Texas Edition will come with a complementary "Come and take it" sticker.

"Southern Heritage" flag interior design & center console wallpaper will be a paid extra.

[+] hadtodoit|5 years ago|reply
This might come as a shock to you but most people do not care what the political opinions or behavior of a car manufacturer's CEO are. Likewise the internet does not at all reflect the views of your average person, and I would wager that despite Tesla fanatics being very aware of Musk and his eccentric behavior, most Tesla owners moving forward won't even know or care who the CEO is as they rollout to mass market. This won't make a dent in his customer base. Musk is beyond reproach at this point, his "fuck you" warchest is too big.
[+] kylec|5 years ago|reply
> I'm quite the Musk fanboy

Still? I can understand still being a fan of Tesla or SpaceX, but I'm suspicious of anyone that's followed Musk's behavior recently and is still like "that's my guy!"

[+] Aperocky|5 years ago|reply
> Musk has been completely unhinged the last few weeks

The most logical guess I can make is he on some new drugs that's starting to damage his brain. Some form of synthetic or maybe good ol heroin.

[+] m0zg|5 years ago|reply
"Republicans buy shoes too". He even referred to taking both pills in the very next tweet, but some people are too dense to understand what he meant.
[+] lowdose|5 years ago|reply
He needs sales volume and the progressive part of the population is not enough. Onboarding more conservatives is his only option. Progressives do not have many viable alternatives to what Tesla is offering, bait and hook. Classic diffusion of innovation what Musk does, the sequence of Tesla models are 100% reflecting different parts of the bell curve.
[+] drak0n1c|5 years ago|reply
Elon dabbling in civil liberties activism and countering far-left "rose twitter" with the rose emoji and red pill phrase is not "going full alt-right" -- the political spectrum is more nuanced than that.
[+] epistasis|5 years ago|reply
I'm already looking at the competitors to the Model 3 that are coming out in the next few years. I have loved this car, but Musk is toxic and I don't want to be finding him anymore. I know maybe 5 other people with Teslas, and two others have already said they're looking to switch too.

Part of the Tesla story was that it could be a California pride thing. When Musk makes the state his enemy, and acts like an idiot, and is simultaneously an absolute publicity whore that claims credit for all sort of work that is not his, well, he had better be ready to accept the consequences for acting like a traitor in a war.

[+] outside1234|5 years ago|reply
"But Musk is said to want to start construction extremely soon and aims to have Model Y vehicles coming out of the plant by the end of the year."

That is just delusional.

[+] eloff|5 years ago|reply
I think the rule with Elon Musk is all his estimates are extremely optimistic and you need to multiply them by two or three to get closer to reality.

But I'm sure it serves a purpose in giving his employees an aggressive target to aim at. Even if they miss it, at least they probably got there sooner.

[+] _Microft|5 years ago|reply
According to Wikipedia (german article on Tesla Gigafactory 3), Tesla went from the ground-breaking ceremony at beginning of january 2019 in Shanghai to first cars produced there in november of the same year.

They might be getting practice in building factories (what's the learning curve for car factories?).

[+] toolz|5 years ago|reply
So they've already built a factory in under a year, but it's delusional to think they could cut that time by 30-40%?

I don't think it's likely to happen, but delusional is a stretch.

[+] sidibe|5 years ago|reply
He has no sense of time. Every year they're supposed to have robotaxis by the end of the year and they've only just started to jankily handle stoplights
[+] briffle|5 years ago|reply
Keep in mind, this isn't a brand new line/model. They have an existing line in place in China at least, they just need to copy it. They also built a new line in a giant tent in CA in a few weeks.
[+] sliken|5 years ago|reply
I'd think that, but I have to say that china model 3 factory went from mud to producing cars amazingly quickly. The ended up being what 9 months ahead of schedule?
[+] rory_isAdonk|5 years ago|reply
this is simply to keep the stock price at a certain level. half of everything he says is to feed into an image which keeps that stock at that level.
[+] jjtheblunt|5 years ago|reply
what if the slow stage is acquiring the heavy machinery (stamps, industrial robotics), and those are available with less delay than before?
[+] voodooranger|5 years ago|reply
maybe. but they’re getting better at building the machine that builds the machine that builds the machine.
[+] leesec|5 years ago|reply
In America yeah. They did it in China.
[+] cobookman|5 years ago|reply
I get the feeling this was already planned. Freemont doesn't have much spare land to increase manufacturing capacity. California has to be more expensive (Labor, Regulations) than manufacturing in Texas.

Even if you'd need to fly your R&D team between Texas and California, you'd still be saving money

[+] justin66|5 years ago|reply
In some vague "regulations" way, possibly, but the published hourly rates of Tesla Fremont workers are not especially high. (I just googled the average as being less than twenty dollars, which can't possibly be right, but I do remember the figure being low by autoworker standards)

The thought that they might pay even less in Texas is depressing.

[+] reaperducer|5 years ago|reply
Hours after Electrek's story ran, three news organizations—TechCrunch, CNBC, and the Associated Press—all published stories stating that Tesla was still considering Tulsa, Oklahoma.

Tulsa is a better choice for one reason: Being able to say "Tesla Tulsa." Or "The Tulsa Teslas." Or "I wanna test a Tulsa Tesla."

Maybe instead of a tax break, the city could offer to change its name to Tesla. Cities have changed names for sillier reasons.

[+] pplante|5 years ago|reply
Elon aims to be producing cars from the new factory by end of year. Is it possible that when he says factory they mean the tent structures they are using and continuing to build in Fremont? If so, then maybe his timeline isn't terribly far from reality. I agree that EOY might be ambitious, but by summer 2021 might not be. It all depends on the structure they build to meet that goal.
[+] akmarinov|5 years ago|reply
Will they be able to sell the cars from that factory directly to end users without dealerships in Texas?
[+] yalogin|5 years ago|reply
IF the recession economists are predicting ends up happening it has to make a significant dent in Tesla's sales right? Wonder how all of this will pan out then. I guess building the factory is still needed, recession or not. So they keep at it.
[+] omgwtfbyobbq|5 years ago|reply
Eh, I think low volume Y production by the end of the year is possible, but it's unlikely.

On one hand, they don't need to do as much as they did in Giga Shangahi because they already have the Model Y specific bits in Fremont, which they can ship to the new factory.

They just need to replicate all the Model 3 stuff the Model Y uses from Giga Shanghai and install the Model Y specific stuff they ship in from Fremont, which should be faster than Giga Shanghai.

On the other hand, they only have 6 months left to do this and we're in the middle of a pandemic.

What people neglect to consider is that Tesla now owns Perbix and Grohmann, which is very advantageous when building new factories.

[+] eggsnbacon1|5 years ago|reply
Texas is probably the best place to build trucks for PR value. "Texas edition" is something they even put on trucks made in Mexico. Texas is seen as strong and independent, values respected by much of the customer base. To be less politically correct, "Made in California" will definitely hurt sales for some of the redneck demographic.

Its great economy doesn't hurt either. Unlike cars, there's not a strong value in having these trucks on the coast near export terminals. Non-commercial trucks are very much a US thing. And even more a Deep South thing.

[+] m463|5 years ago|reply
I think Texas aligns well with the size and outrageousness of the cybertruck.
[+] gibolt|5 years ago|reply
Their goal is to begin assembly, much like Fremont's tent. Shanghai is producing many of the parts in-house requiring a much more robust set of tooling, supply chain, and overall clean, enclosed space
[+] gregimba|5 years ago|reply
I'm picturing the new Cybertruck will sport the same sticker the Tundra's did when they were made in Texas.

Born in Texas built by Texans.

[+] TheBlight|5 years ago|reply
Aren't the Tundras still made in San Antonio? IIRC they also contain the most parts fabricated in the US of any pickup in class. (Disclosure: Don't work for Toyota nor own stock but I do own a Tundra.)
[+] yumraj|5 years ago|reply
I really hope that he builds his factory and moves out of CA.

People can still buy his cars but at least we in the BA won't have to listen to his temper tantrums.

He's taken the red pill anyway...

[+] CharmingFrock|5 years ago|reply
I don't think Texas allows mathematical baby names either.
[+] explorigin|5 years ago|reply
Likely, but not yet decided. The other front-runner is Tulsa.
[+] RickJWagner|5 years ago|reply
Texas is trendier, but all of Oklahoma would instantly be rabid Tesla fans if Musk chooses Tulsa.

I hope he does.

[+] api|5 years ago|reply
I'm astounded that they ever tried to operate a factory in the Bay Area to begin with. Forget about regulations and taxes. The real issue is cost of living. You're going to have to pay all employees 2-3X what you'd have to pay them elsewhere, and it's not like they're keeping any of that. It's all going to rent/mortgage payments.
[+] toomuchtodo|5 years ago|reply
Tesla was strapped for cash at the time and picked up Fremont, which used to be the joint venture NUMMI facility between GM and Toyota, for almost nothing. It was a necessary concession to bootstrap Tesla. Arguably, they have outgrown the need for such a small facility after Texas and the next battery facility are built.

https://en.wikipedia.org/wiki/NUMMI

[+] FreedomToCreate|5 years ago|reply
They don't pay Tesla assembly workers much, very comparable to what GM and Ford pay in the Detroit Metro Area. Ford pay 13-30 dollars(source:payscale.com) while Tesla pays 18-30 dollars (source - father in law who works on the line). Most people are older men who never got a college education or younger men following the same path. They all live in multifamily units in the bay area, and thats how they afford it. Even with the sky high cost, these people see the bay area as their home and are not going to pick up and leave, so they is always labor available for manufacturers.
[+] chubot|5 years ago|reply
I wouldn't assume that... The employees Tesla hires are somewhat disjoint from the ones that VC-backed startups/FAANG are hiring (with some software overlap, but I'm not sure where they do software). And the employee pool surrounding the Fremont area is somewhat disjoint from the pool surrounding SF/Palo Alto as well.
[+] btian|5 years ago|reply
They bought a $1B factory for $50M when they didn't have much cash.

Building a new factory in Texas was not an option.

[+] delfinom|5 years ago|reply
Austin is comparatively better but not a whole lot. The big three cities in Texas are getting extremely expensive with ridiculous traffic to boot.
[+] m463|5 years ago|reply
I expect there are a lot of the required engineers available in the area. And that's where the company started.
[+] Simulacra|5 years ago|reply
Musk is a more vocal, libertarian version of Steve Jobs. He pushes forward when others say no. Like him or not, you cannot deny his achievements.