A $45 Million Deal For Tesla To Acquire Land For Gigafactory 4 Near Berlin Is Approved
Posted in: Financial, Model Y, Tesla

A $45 Million Deal For Tesla To Acquire Land For Gigafactory 4 Near Berlin Is Approved

/ January 10, 2020 / 925 Views

The site will host the factory designed to produce batteries, powertrains and the Model Y

When Elon Musk, the Tesla CEO, confirmed that the company is going to build the Gigafactory 4 in the “Berlin area”, many of us were quite surprised by the announcement. After all, building an EV factory on German soil, right in the middle of a country who’s automotive industry is the backbone of its economy, looks like a rather bold move. However, a European factory seems like a logical move for the electric car maker. This week, a deal that will allow Tesla to acquire land outside of Berlin to build its recently announced Gigafactory 4 has been approved by the state government. It will cost the carmaker $45 million (€41 million). But, the deal isn’t sealed yet. It’s where Tesla aims to build “batteries, powertrains, and vehicles, starting with Model Y” in Germany.

Tesla Model Y
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Tesla Model Y

The project will sit on a 300-hectare plot of land next to the GVZ Berlin-Ost Freienbrink industrial park, around 25 miles (40 kilometers) from Berlin. But, this being Germany and all, the company is certainly going to face some legal hoop-jumping before it can start building the factory, that’s for sure. Right now, the Brandenburg parliament has approved the sale of the piece of land to Tesla. However, the company is not planning to sign the deal for a few more weeks. Here’s a translation of the Der Tagesspiegel reporting on the matter below:

The responsible finance committee of the state parliament approved the purchase agreement with the majority of the Kenya coalitioners on Thursday afternoon, according to which the 302-hectare forest area is to be sold to Tesla for €41 million. According to the state government, the group does not want to decide on the purchase contract until mid-January. The committee met in a non-public meeting, as is customary for property sales. The decision was made after almost two hours of debate.

Currently, Tesla faces some stringent opposition in the Brandenburg government on both the price-per-square-foot and the ecological impact of the deal. Right now, Tesla needs to wait for an official value assessment (expected to happen soon), which might push the price higher just a bit. However, we’re pretty sure that this won’t impact the company’s decision to build the factory there, as Elon Musk seemed adamant to make that happen. Furthermore, even though Tesla is committed to planting three times as many trees as it is going to cut down, this is definitely a controversial process as many complex issues of the forest ecosystem will have to be addressed. For one, an endangered species of a bat will have to be moved before construction begins.

Tesla Model Y
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Tesla Model Y

One more thing that comes to mind when building such large facilities in Germany, especially near or in the capital city, is the unexploded WWII ordinance that Tesla will have to keep in mind while clearing/building the factory. As stated previously, Tesla aims to build batteries, powertrains and vehicles, namely the Model Y at the Gigafactory slated to be built at the site. With the goal of starting the production in 2021, the company will have to make haste and start construction soon if they’re planning on meeting their goals over here. While definitely a hurdle, it will be interesting to see how it all boils down. And naturally, seeing what the response from their bitter rivals in the Big German Three will be as well.

Source: Elektrek

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