Elon Musk invited press to a soft launch of Tesla's US$% billion Gigafactory in Nevada. Flickr: Steve Jurvetson
Tesla’s second Master Plan will be mostly funded by sales of its vehicles, particularly the new electric vehicle Model 3, chief executive Elon Musk said during a soft launch of the enormous ‘Gigafactory’ in Nevada on Tuesday.
He told reporters that the upcoming Model 3 could generate US$20 billion revenue per year with roughly US$5 billion in gross profit once fully operational with the generation of half a million vehicles per annum. This could help pay for the new Tesla master plan, which incorporates solar-plus-storage for all households, car sharing and electric trucks among other proposals.
The electric vehicle and energy storage firm’s vast new Gigafactory facility, costing roughly US$5 billion, is far from fully operational with just a small portion complete, but Musk invited media in for a rare viewing this week. Japanese firm Panasonic Corp partnered with Tesla for the Gigafactory build, indicating in January that it may invest up to US$1.6 billion in the facility.
The official grand opening is expected this Friday (29 July), with Tesla expected to open up its long-awaited factory in sections over time as part of its plans to meet a giant backlog of deposits put down for the Model 3, retailing for US$35,000, whose battery packs will be built at the new facility. It will also be producing its much-touted Tesla Powerwall and Powerpack energy storage systems.
Musk said the Model 3 is now engineered and expected to start production in the summer of 2017.
Tesla claims its products raise the bar on cost-competitiveness by virtue of the production scale it expects to achieve at the Gigafactory. Some have questioned the trumpeted price advantages, particularly for the Powerwall, claiming that total system costs are much higher than Tesla admits.
In an article for Energy-Storage.News, Lux Research’s Chris Robinson wrote of what to expect from the Tesla ‘Master Plan: Part Deux’ going forward.
This article was revised to say that the Gigafactory produces the Model 3 battery packs