Tesla updates $2 billion Gigafactory spending plan
- August 7, 2016
- Posted by: Jennifer
- Category: News
Electric car-maker Tesla Motors updated its plan to spend an estimated $2 billion on the Nevada battery factory it’s building with partner Panasonic Corp., according to a document filed with the Securities and Exchange Commission. And it warned costs could exceed estimates.
According to the filing, Tesla has already spent $430.7 million on the factory in Storey County, just east of Reno. Company officials estimate another $520 million in spending on the factory in 2016, with $117 million spent during the first half of the year.
“Tesla’s contribution to total capital expenditures are expected to be about $2 billion,” the filing stated.
With the massive factory estimated to cost $5 billion, it suggests Panasonic will be paying the bulk of the bill. It also reflects ramped up construction efforts at the factory in order to meet the company’s ambitious production goals for the Model 3 car and other products.
That fits with a June 21 report by Nikkei Asian Review that anticipated Panasonic would spend more than the company’s original estimate of $1.6 billion.
That report stated, “the company ‘would like to avoid delays in [Tesla’s] auto production caused by an insufficient battery supply,’ an executive at the Japanese electronics maker said.”
The Friday filing from Tesla also including a warning that, “the cost of building and operating the Gigafactory could exceed our current expectations and the Gigafactory may take longer to bring online than we anticipate.” The warning has been included in previous filings.
The filing also states the company expects Panasonic will be producing battery cells in Nevada by the end of the year.
“Panasonic has agreed to partner with us on the Gigafactory with investments in production equipment that it will use to manufacture and supply us with battery cells,” the filing states. “Under our arrangement with Panasonic, we plan to purchase the full output from their production equipment located at the Gigafactory at negotiated prices.”