After some delay, Tesla has opened its first Giga Factory in Germany—and the first in Europe. The factory was years in the making and opened well behind schedule in part thanks to the COVID-19 pandemic. However, it’s set to have major implications for Tesla’s supply chain, reports CNBC.
Right now most Teslas sold in Europe are shipped from Tesla’s factories in China to European customers. The distance the Chinese-made Teslas need to travel to get to their European owners lengthens delivery times and adds additional costs. With the new Giga Factory in Grünheide, Germany, Tesla will be able to supply up to 500,000 vehicles to European buyers much faster starting today. While this may be happy news to European EV enthusiasts, the factory’s opening was delayed from its original summer 2021 data due to the pandemic, supply-chain issues, and environmental concerns.
Excited to hand over the first production cars made by Giga Berlin-Brandenburg tomorrow!
— Elon Musk (@elonmusk) March 21, 2022
The latter is why the opening of Europe’s first Tesla Giga Factory in Germany isn’t without controversy. Residents and businesses in the Grünheide area have expressed concern over the impact of the factory on the local water supply. While Tesla was able to obtain permits for water in the area, regional authorities confirmed that additional industrial and commercial development plans by other companies were no longer possible unless additional permits are made available to tap into water reserves in the area, reports Bloomberg.
But though Tesla got access to the water it needs to run its new factory, the lack of reserves is already threatening to hinder the future expansion of the facility. Tesla’s goal is to eventually produce 1 million cars per year at the Grünheide factory, twice its production number now. Yet that will be impossible unless it is granted access to more of the area’s scarce water reserves.