Elon Musk blamed Brexit for Tesla plant snub – but it may have nothing to do with it

5 mins read


In 2019, billionaire entrepreneur Mr Musk announced that his company’s new factory would be built on the outskirts of Berlin, Germany. Speaking to trade site Auto Express after the announcement, Mr Musk said: “Brexit uncertainty made it too risky to put a gigafactory in the UK.” He also claimed that his decision was influenced by Germany’s strong track record on engineering.

Mr Musk added: “Everyone knows that German engineering is outstanding and that’s part of the reason we are locating our Gigafactory Europe in Germany.”

So far Tesla has factories in New York, Nevada, California, and Shanghai.

Its California gigafactory is three floors high, spans 4.9 million square feet, and holds over 2,500 workers.

The factory in Berlin, which will produce batteries, battery packs and powertrains for use in Tesla vehicles, and also assembles the Tesla Model Y, is expected to begin operations in July 2021.

As anticipation for the new plant mounts, newly-resurfaced reports suggest Mr Musk’s decision to shun the UK in favour of Germany did not have anything to do with Brexit.

In a 2019 report for Wired UK, Business editor Natasha Bernal wrote: “Tesla’s tentative plans to open a research and development centre in the UK had already been shelved indefinitely after unsuccessful talks in 2014.”

She added: “Despite having the largest electric vehicle manufacturing market in Europe in 2016, the UK’s sluggish domestic policy on petrol and diesel bans and the impact of Brexit has put it firmly on the back foot.

“Germany could also become Tesla’s biggest consumer base in Europe.

“This is partly because the country’s federal court permits individual cities to ban diesel vehicles altogether, and several cities — including Frankfurt, Munich, and Berlin — have already banned older diesel models that burn fuel less efficiently.

“And now they can buy them locally.

“The brand new site of Tesla’s production line for Model Y and Model 3 cars will be a short commute by train or road from the centre of Berlin at a yet undisclosed location, powered by a combination of solar, wind and geothermal energy paired with battery storage for net-zero emissions.”

Moreover, claims that Mr Musk and Tesla could soon be coming to a Somerset site seem to reinforce this argument.

Last year, reports revealed the electric vehicle company was considering a move to build a new gigafactory at a currently under construction “smart campus” near Bridgwater, called Gravity.

PropertyWeek claimed that in the summer of 2020 Prime Minister Boris Johnson’s Government was urgently seeking a four million sq ft site to accommodate a new Tesla gigafactory and that Gravity was one of the sites “trying to secure the enormous letting”.

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Bridgwater site is one of only a handful of locations in the UK capable of housing a gigafactory and the large 635 acre location would appear to be an attractive potential base for Tesla.

Mr Musk is no longer the world’s richest person after shares in the electric car company dropped 8.6 percent on Monday, wiping $15.2billion (£10.8bn) off his fortune.

Mr Musk, who last month surpassed Amazon founder Jeff Bezos to take the title of the world’s wealthiest person, dropped back into second place with a $183billion (£129bn) estimated fortune behind Bezos’ $186.3billion (£132bn).

The 8.5 percent drop in Tesla’s share price on Monday – the sharpest one-day fall since September – was partly fuelled by Mr Musk tweeting that the prices of Bitcoin and other cryptocurrencies “do seem high”.

Tesla’s shares were down a further six percent in pre-market trading on Tuesday.



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