Cheapest Tesla Model 2 to be mass produced in more places
A number of factors like public transport network density, narrower winding roads, and higher fuel price taxes, have contributed to the preference of Europeans for more compact and frugal cars than the average vehicle driven in America. This fact hasn't gone unnoticed by Tesla which is now deciding on where to assemble its first mass market EV, tentatively dubbed the Model 2.
Apparently, the Tesla Model 2 will be produced at the Gigafactory in Berlin, too, as Elon Musk himself tipped during his visit at the Brandenburg facility this week. Besides the pep talk that praised the efficiency and importance of the Giga Berlin employees, Elon Musk reportedly announced that "a 25k € Tesla will be built here."
Now, whether Elon Musk tipped the Model 2 price, or simply referred again to Tesla's "next-gen platform" that is expected to cost less than US$25,000 before any federal or state subsidies, the fact remains that Tesla will bring its assembly closer to the markets with the biggest sales potential.
The Model 2 was initially scheduled for mass production at a brand new Gigafactory in Mexico. So much so that the rumors pegged the mass production capacity of the Model 2 there at 2 million units per year when fully scaled, with another 2 million slated for production at Giga Shanghai.
Despite getting all the necessary Giga Mexico permits just recently, however, Elon Musk tipped at the Q3 press conference that the first batches of the cheapest Tesla will initially be assembled at Giga Texas.
We’re actually only occupying a tiny corner of the land that we have. We could technically do all the scaling, research just here. So, personnel is our biggest challenge and the greater Austin area only has - generously the greater Austin area only has 2 million people. So people are moving here and they’re willing to move here, but there is somewhat of a housing crisis. They got to live somewhere.
The change of heart regarding Giga Mexico reportedly happened not only because of union and permit challenges, but also because it would be harder to get skilled Tesla employees to relocate to Nuevo León than to Austin.
Elon Musk did vow that Tesla is "going to build it... and I mean we’ll start the initial phases of construction next year," though. Before Tesla starts churning out what Elon Musk called "utilitarian" Model 2 at Giga Mexico, though, it will apparently test the demand waters with mass production at the Gigafactories in Austin and Berlin first.