The Tesla Factory Near Berlin Elon Musk Shows the Germans How to Move Quickly

Tesla is racing ahead with construction of its new factory just outside of Berlin. All that's left for German carmakers is to watch and learn.
Tesla founder Elon Musk: "A ton of fun!"

Tesla founder Elon Musk: "A ton of fun!"

Foto:

Julian Stähle / dpa

A large property map hangs in the mayor's office, right next to a display cabinet full of memorabilia accumulated over a long term in office. The coat of arms of the town of Grünheide on the map has faded, as has the writing: "Net settlement area of 300 hectares," it reads, if you look hard enough.

Arne Christiani's predecessor hung up the poster 20 years ago, back when BMW wanted to build a car manufacturing plant on the site, but then chose the city of Leipzig instead. "When I was first elected mayor in 2003, I left the map up," says Christiani. The pine forest on the edge of the town has remained his field of dreams for almost 17 years.

During that time, Grünheide has grown steadily, but its population has also aged. It's a place that's beautiful for people who appreciate peace and quiet, but not one that’s particularly tempting for the younger generation. Each year, Christiani has apologized to locals on International Volunteer Day for the fact that it had once again not been possible to attract high-quality industrial jobs to the area.

For some time now, though, two new maps have been hanging above the old one, with the parcel of land colored red. Christiani's dream could finally be coming true, with Tesla hoping to build electric cars on the site.

Dreams Threatened, Dreams Come True

If you leave Town Hall and walk a good 800 meters through a pine forest to the edge of the village, you reach a lake called Peetzsee. Christiani had been in office for two years when Johannes Curth and his family came to fulfil their dream here, swapping a rental apartment in Berlin’s Prenzlauer Berg neighborhood for a home of their own, surrounded by forests and lakes.

The Curths bought a plot of land just a few meters from the shore of the lake back when prices were still reasonable. They built a house with large windows and surrounded by a good-sized yard, in which stand two magnificent old trees in it.

DER SPIEGEL 39/2020

The article you are reading originally appeared in German in issue 39/2020 (September 19, 2020) of DER SPIEGEL.

But now that Mayor Christiani's dream is coming true, Curth sees his own dream threatened. "We moved here because of the peace and quiet and the nature," he says. "What will happen if Tesla starts building cars here?" He fears for the quality of the water and air. And he worries about the extra traffic and what will happen to this sleepy community of 8,755 people when Tesla moves in.

Elon Musk, the entrepreneur behind the carmaker, is an uncompromising man whose ideas jump back and forth between California, Mars and Grünheide. The head of the world's largest electric car manufacturer builds rockets that ferry people into space and dreams of building a hyperloop tunnel for passenger transport. He is adored by his followers because, as an entrepreneur, he refuses to accept any limits.

Breathtaking Speed

Almost as a byproduct, Musk is now also changing not only the provincial state of Brandenburg, where he’s setting up his factory, but also Germany. The project just outside of Berlin is becoming symbolic for industrial policy in times of climate change. Whereas German companies tend to moan and dig in their heels when the government sets overly ambitious climate targets, as they did last week when the new European Union climate goals were announced, Tesla brings both together: sustainable manufacturing and speed. Breathtaking speed.

Tesla Gigafactory in Grünheide: Are the Germans fast enough?

Tesla Gigafactory in Grünheide: Are the Germans fast enough?

Foto: Robert Grahn / euroluftbild.de / ullstein bild

Musk's Gigafactory will be built in a region where most structures tend to be single-family homes, if there are any at all. In the first stage of development, 12,000 people will work around the clock in three shifts. Once the factory is complete, more than 40,000 people could produce a good 2 million Tesla vehicles here. "Please work at Tesla Giga Berlin! It's going to be a ton of fun," Musk recently tweeted in German.

For quite some time, German car executives and politicians tended to make fun of Musk, notorious as he was for his outrageous personality on Twitter. When he outlined his visions at a 2014 lunch with Peter Altmaier - who was chief of staff of Angela Merkel's Chancellery at the time but is now economics minister – and raved about the advantages of electric propulsion, saying it could be used in all means of transportation except for rockets flying into space, Altmaier still thought he sounded a bit unhinged. "At the time," says Altmaier, "nobody thought this technology would be so successful." At least the German competition didn't.

As recently as 2018, when the California-based company was having troubles with the serial production of its Model 3, Volkswagen considered becoming a strategic investor in Tesla to teach Musk how to do mass production. But reality has long since overtaken that idea: Tesla is now worth five times as much as Volkswagen on the stock exchange.

The days when the billionaire had to ask politicians for an appointment are over. When he came to Germany in early September to visit his construction site, the reception he received was that of a pop star. Fans shared the latest movement data of his private jet and puzzled where he might pop up next. Leading politicians cleared their calendars at short notice.

This week, the Musk party is set to continue, and his name will once again appear in newspapers around the world. He has slated this Tuesday as "Battery Day,” when he plans to announce the progress Tesla has made in battery technology in addition to identifying the site of at least one new battery plant. There are many indications, including interviews with Musk, that Grünheide may be chosen as the site. If it is, giant tree-felling machines would again show up to wait for authorization to clear another 60 hectares (nearly 150 acres) of forest.

It would send an unmistakable message. Because one day later, on Wednesday, hearings are set to begin in the nearby town of Erkner on the 406 complaints against the factory that have been filed by environmental associations and residents. Construction, though, has already been underway for months, with Tesla deciding to move ahead at its own risk with preliminary permits.

Faster and Better

A recent visit to the construction site in Grünheide provided a glimpse of the degree to which Tesla's mantra has been internalized at Tesla, a mantra by which speed counts most. Evan Horetsky, who heads the roughly 100-member Tesla team in Grünheide, showed a number of interested journalists around the construction site.

The slim man in his mid-30s with a shaved head and carefully trimmed beard is one of the troubleshooters on Musk's team. He helped out with the Tesla factory in California before going to Reno, Nevada, to lead the creation of the company's first Gigafactory. That had hardly been finished by the time construction in Shanghai began. He says that he and his people have gotten "faster and better" each time. Now, Horetsky is moving things along in Brandenburg.

Just last fall, the site was covered with tall pine trees. Now, though, they have been replaced by dozens of white concrete pillars protruding from the levelled ground. In the rear section, the shell of the paint shop has been erected. "We gained experience during the construction of the first buildings that we could directly apply in the further development of the design," the American says. "It enabled us to save a couple of days."

Mayor Arne Christiani: A field of dreams.

Mayor Arne Christiani: A field of dreams.

Foto: HC Plambeck / DER SPIEGEL

The fact that final permission to build the factory has not yet been granted and that skeptical citizens must first be heard doesn't bother Horetsky. He says he takes their fears seriously. He notes that similarly complicated requirements had to be fulfilled when building the factory in Shanghai. "The difference to Germany is that here, the people who are directly affected can have their say," says Horetsky. "And who has more of a right to air their views than they do?"

It is, essentially, the concrete realization of what had been an abstract discussion. What price is society prepared to pay for the future? And are Germans capable of keeping up with the necessary pace?

The Gigafactory is set to be built in record time, with the first Y model electric SUVs slated for shipping as early as summer 2021. Plans call for 500,000 electric cars to be produced annually by the end of the first construction stage, a pace the Wall Street Journal has described as "breakneck."

And all this is taking place in Germany, a country where the length of approval procedures has almost doubled in the last 10 years. And in the state of Brandenburg, where construction of the Berlin-Brandenburg Airport (BER) has been marred by endless construction problems and is finally set to open its doors, fully nine years behind schedule.

Not Even Corona Has Slowed the Project

It sounded almost like a joke initially: An American high-tech car company with a volatile boss meets German environmental law, citizen participation and German bureaucracy. Now, though, it looks as though electric cars could start rolling off the assembly line in Grünheide even faster than they did in centrally steered China. And not even the coronavirus has thus far managed to slow down the project.

Somehow, the clichés didn't hold true. Tesla may be a tenacious, demanding company, but it also takes criticism seriously and tries to address it. In contrast to German companies, Musk uses every possibility that planning law avails him to accelerate construction, but he does so at his own risk. At the same time, the Brandenburg government has shown itself to be a skilful negotiator in the fight for the project. Since the contract was awarded, a task force of employees from the participating authorities has met weekly with Tesla representatives to discuss progress on the project.

Axel Vogel was one of the founding members of the Green Party in 1980. He worked in the party's state chapter office in Bavaria, and also held office for the party in the German federal parliament, the Bundestag. He came to Brandenburg in 1991 after the fall of the Berlin Wall and has served as the state's environment minister since last year.

After 40 years with the Greens, Vogel knows all the battles that have been fought over major industrial projects in the name of environmental protection. "From the very first moment, I saw Tesla setting up a site here as a great opportunity," he says. "Finally, the German automotive industry is being warned." He says domestic carmakers have been trying for far too long to save themselves with lazy compromises like the plug-in hybrids.

Vogel is full of praise for Musk. "Tesla's declared goal is to solve problems, not create them," he says. During all these months, he says the company has spoken frequently with environmental organizations in an effort to address and dispel their concerns. By making changes to its plans, for example, Tesla reduced the factory's water consumption in the first expansion phase from over 3 million cubic meters per year down to 1.4 million. "That may sound like a lot at first," says Vogel. "But we have individual farms that consume between 600,000 and 800,000 cubic meters per year."

Local resident Johannes Curth: "What will happen if Tesla starts building cars here?"

Local resident Johannes Curth: "What will happen if Tesla starts building cars here?"

Foto: HC Plambeck / DER SPIEGEL

Jörg Steinback, a member of the center-left Social Democrats (SPD), says: "I don't know of any other company in Germany that is involved in a project like Tesla’s." German companies first plan their factories, wait until all permits are issued and then begin building. "Tesla constantly optimizes the plant as it goes through the regulatory process," says Steinbach. "This leads to frequent changes in applications and also presents a major challenge for the authorities that must provide their approval." To cite but one example, the car manufacturer has changed the basic design of the plant several times. The changes were so sweeping that a completely new application for approval had to be submitted over the summer.

To prevent jeopardizing its ambitious deadlines, Tesla is pressing ahead with construction using preliminary permits for individual steps. The first one was obtained by the company for felling the trees, the second for levelling the site, and construction crews are now working with a fifth preliminary permit. This would allow the factory to be completed before final approval is given.

A Calculable Risk

It is a process that anyone can follow, but no one has used the instrument as forcefully as Tesla. The risk is that the company might have to tear it all down again if regulatory approval isn't granted, but it's also a calculable risk because the authorities in question only issue the prelimary permit under the assumption that their final decision will be a positive one.

German automobile executives like VW CEO Herbert Diess have long since become vocal admirers of their American rival. Tesla, he reminded top Volkswagen executives in January, creates its profit margin "across the entire value creation chain." Tesla, he said, isn't just a carmaker, but also a battery manufacturer, a dealer and a service provider. He says this enables Tesla to identify customer needs in an "unparalleled" way and to generate profits in areas that go "far beyond what we can do with our conventional car business."

Musk's bold plan years ago to build a closed system of Tesla charging stations to go with the company's electric vehicles is now paying off. "If the range of an electric car is great enough and there is a network of rapid charging stations," he told DER SPIEGEL back in 2014, "there is absolutely no need for an additional motor."

Back then, the heads of major German carmakers didn't believe that e-mobility would see rapid success, nor did BMW, Daimler and VW feel responsible for developing the needed infrastructure. After all, carmakers didn't run gas stations either.

Tesla now has more than 5,300 e-charging columns across Europe. Its German competition, the charging station consortium, ionity, created by BMW, Daimler, VW and Ford, has only 1,300.

Earlier this month, Tesla opened up 12 new charging columns in the Schöneberg neighborhood of Berlin. The fact that it wasn't just any old fueling station was made clear by the guest list, with Economics Minister Altmaier showing up for the festivities. He held a speech full of praise for the company from California, saying German industry could only benefit. "Germany is pleased that Tesla is becoming a German brand," he said.

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