Gigafactories

The Gigafactory Concept

Tesla coined the term "Gigafactory" in 2014 to describe factories operating at gigawatt-scale battery production. The concept has since evolved into Tesla's vertically integrated manufacturing philosophy: massive facilities that produce batteries, electric motors, power electronics, and complete vehicles all in one location.

This approach gives Tesla significant advantages over traditional automakers who rely on extensive supplier networks. By controlling the entire production process, Tesla can iterate faster on designs, reduce supply chain costs, improve quality consistency, and scale production more rapidly.

Each Gigafactory is tailored to its regional market. Giga Shanghai serves the world's largest automotive market. Giga Berlin supplies Europe. Giga Texas produces Cybertruck and serves as corporate headquarters. Giga Nevada focuses on batteries, Semi trucks, and Megapack energy storage. Together, they form a global manufacturing network capable of producing over 2 million vehicles annually.

Manufacturing Innovations

Mega-Casting: Tesla pioneered the use of massive 6,000-9,000 ton casting machines (from IDRA) that produce single-piece aluminum structural components. The Model Y rear underbody, which previously required 70+ stamped and welded parts, is now a single casting. This reduces weight, improves structural rigidity, and slashes production time and cost.

Unboxed Process: Tesla's next-generation manufacturing approach assembles vehicles from large sub-assemblies simultaneously rather than on a traditional linear production line. This enables 40%+ reduction in factory floor space and 30%+ reduction in manufacturing costs, critical for producing an affordable sub-$30,000 Tesla.

4680 Battery Cells: Tesla's in-house 4680 cells are larger, cheaper, and more energy-dense than the 2170 cells from partners. Produced at Giga Texas and Giga Nevada, these cells are essential to Tesla's plan to drive down battery costs to $50/kWh -- a threshold that makes EVs cheaper than gas cars without subsidies.

Future Expansion

Tesla has confirmed plans for additional Gigafactories to meet the company's goal of 20 million vehicles per year by 2030. The next factory location -- widely speculated to be in Mexico (Monterrey), India, or Southeast Asia -- will focus on producing Tesla's upcoming affordable vehicle platform.

Existing factories are also expanding. Giga Texas is undergoing a massive Phase 2 expansion for the Cybertruck and next-gen vehicle. Giga Nevada's $3.6 billion expansion adds 4680 cell production and a dedicated Semi factory. Giga Shanghai is exploring additional capacity for export volume. Giga Berlin has permits for a significant expansion that would more than double its current output.