Tesla gathers paperwork to open Austin-area factory

Tesla Inc. sees record closings in 2021, with analysts predicting big things from the electric vehicle maker in 2022.

All eyes are now on the start of the company’s factories in Austin and Berlin, according to analyst Dan Ives of Wedbush Securities Inc. will be very important for Tesla (Nasdaq: TSLA), its production capacity has the potential to reach around 2 million vehicles this year to double.

To put this in perspective, Tesla delivered more than 936,000 vehicles last year – 87% more than in 2020, the company’s first fully profitable year.

The Austin factory is scheduled to start each day. Group boss Elon Musk has long scheduled the start of production in late 2021, but there has been no official announcement of the factory opening.

However, Travis County spokesman Hector Nieto said Jan. 4 that certain parts of the plant had received certificates of conformity from the district fire department chief. This certificate is similar to an employment certificate and is required before a company can open a building.

It’s unclear when the car will start off the assembly line. Tesla employees did not immediately return a request for comment.

Tesla’s factory, which covers an area of ​​at least 4.28 million square feet, is divided into departments such as stamping, casting and general assembly, according to government documents. At the time of publication, it was not clear which department had received the certificate.

Tesla began building the plant in the summer of 2020. It is located on Highway 130 east of Travis County. Tesla intends to manufacture the Cybertruck, Model 3, Model Y SUV and tractor units there.

Musk has big plans for the Austin factory, which he recently said on Twitter as an investment of more than $10 billion “over time” that would create at least 20,000 direct jobs and 100,000 indirect jobs. That’s much higher than Musk’s forecast of 10,000 jobs in March and the 5,000 promised during the economic talks.

Ives, managing director and senior stock analyst at Los Angeles-based Wedbush, said in a Jan. 2 statement that Tesla ended 2021 with a fourth-quarter “trophy case,” despite global chip shortages and global logistics problems.

Tesla announced on Jan. 2 that it had produced 305,840 electric vehicles and delivered 308,600 in the fourth quarter, beating its previous quarterly record and analyst expectations.

“These supply figures are surprising and reflect the development of electric vehicle demand that appears to be stable for Tesla and into 2022,” Ives said in a statement.

Demand for electric vehicles is growing rapidly and automakers are setting up factories across the country to keep up. Tesla, which recently moved to Austin, is considered an industry leader because it dominates market share, said Ives, a Wall Street analyst for two decades and a frequent guest on CNBC’s Squawk Box.

“Tesla currently has a high-end supply problem that is outpacing supply,” Ives said in a Tesla forecast for December 2222. “The key to mitigating this problem lies in the opening of major Giga in Austin and Berlin … which Tesla will reduce congestion around the world.”

Tesla executives announced to shareholders in October that the company expects 50% annual growth on average over the next few years.

Seth Goldstein, senior capital analyst at Morningstar Inc., recently told the Austin Business Journal that he expects production at the Austin facility to grow slowly, as it takes several years for the facility to reach nearly full capacity. In its Jan. 3 announcement, Goldstein estimated Tesla will ship more than 1.5 million vehicles this year, a slightly more conservative estimate than other analysts.

“We have lowered our forecast for 2022 gross margin for Tesla as we expect increased production costs in connection with the opening of two new plants in Austin, Texas (USA) and Berlin, Germany. “Our long-term outlook remains largely unchanged as we continue to expect Tesla’s revenue growth to slow,” Goldstein said.

The year of the Tesla flag wowed Wall Street. On January 3, the first trading day of the new year, Tesla shares rose 13% to $1,199. With a market cap of around $1.16 trillion, Tesla costs more than any other automaker in the world. At the end of 2020, the company had 70,757 employees worldwide, according to its most recent annual report filed with the SEC.

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