Tesla’s race to compete in Europe hits potential roadblocks

Tesla’s planned German battery factory will eventually be “the largest in the world”, CEO Elon Musk told the recent European Battery Conference in Germany, but local media reports say its construction is running into significant opposition from locals and environmental campaigners.

The hold-ups come at the same time as Tesla’s market share in a booming European EV market is faltering. According to a 12-month rolling sales report by EV analyst Matthias Schmidt, Tesla Europe sales flattened off in 2020, before being overtaken from the autumn by the Volkswagen brand in the wake of the launch of the ID 3 EV.

Dubbed the ‘Gigafactory’, the new Tesla battery plant – located 20 miles outside Berlin – will be built alongside a new production line that will be turning out the Model Y, and likely further models to come, from next year. Musk says the production plant should initially reach an annual output of 500,000 units once fully ramped up.

Although work on the production line buildings at Grünheid has progressed at great speed, Tesla is facing problems getting permission to push on with the battery production plant itself.

According to local press reports, after around 300 hectares of pine trees were cleared for the site, local opposition is now centred on the likely water consumption of both the battery production facility and the paint plant.

According to German newspaper Der Tagesspiegel, the Gigafactory foundations and the shell of the plant are in place but further advances on construction were being held up by delays to construction permits, with much of the current building work completed via ‘advance permits’.

It’s suggested this is a likely consequence of an eight-day hearing, held in late September by the local licensing authority, to consider over 400 objections from a wide range of parties.

Local media reports say that the objections are both about the type of paint plant Tesla has planned for the site and how clearing the forest and replacing it with paved surfaces could reduce the amount of rainfall that seeps into the area’s natural reservoirs, affecting water supply to the local population.

The reports also say that the local water company could ask Tesla to build its own artificial reservoir to serve the facility.

At the beginning of November, Musk flew into Berlin to visit the Grünheid site and held a meeting with Brandenburg’s minister of economics, Jörg Steinbach.  According to Der Tagesspiegel, Steinbach said the hour-long meeting was about the hold-ups at the Gigafactory.



However, multiple sources cite homologation details for the Chinese-made Model 3 that revealed the cheaper batteries are also a significant 200kg heavier than the NMC units. The upshot is the vehicle’s overall carrying capacity has been reduced to around 300kg, according to claims on the financial investment site Seeking Alpha.