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by Eva Fox November 14, 2019

Earlier this week, at the Golden Steering Wheel Award ceremony, Tesla's CEO Elon Musk announced that the Tesla Gigafactory 4 will be built in Germany.

Tesla is a pioneer in the field of electric vehicles, which has excited the entire automotive industry in the world. And its new European plant will be located in the Berlin area. The use of a renewable energy sources and the use of the latest software are undoubtedly the keys to Tesla's popularity in Berlin.

Minister President of Brandenburg, Dietmar Woidke said his officials had been negotiating with Tesla for six months. The key to Tesla's final decision was in the green direction of Brandenburg. “Renewable energy is the raw material of the future. Brandenburg has enough renewable energy, and it’s clear that climate protection and economic development go hand in hand.”

 



Brandenburg is known for its wind energy production in Germany, and in green energy production ranks first out of 16 Federal States.

Moreover, now the automotive industry is the union of manufacturing and service industries. There is no large automobile factory in Berlin and no complete chain of the automobile industry. But, being a cosmopolitan city, it can attract young talanted programmers, which are so needed in the modern automotive industry.

According to Handelsblatt, large companies such as the BMW Group and Daimler have already taken advantage of Berlin, and the main office of the car and taxi exchange service is located in Berlin. These companies have many employees in Berlin.

In addition, for Gigafactory 4, Tesla chose an industrial area in the southern suburbs of Berlin, in the Federal State of Brandenburg. The factory will be located next to Berlin Brandenburg Airport, which opens next autumn. A train track cross is nearby as well as an Autobahn. Traffic is especially convenient for foreign employees.

Gigafactory 4 will be located 4 kilometers from Grünheide.  Grünheide is a 8,500 citizen village known for lakes and forests. 

 

What does this mean for business in Germany?

As the automotive industry moves toward electrification, supply chains will be established. It is expected that after Tesla's arrival in Berlin, German factories for the production of equipment and components will receive only benefit.

And this is good news for Germany as a place to do business. Minister of Economic Altmayer speaks of a “milestone” in expanding electric mobility. Germany has the opportunity to become an international center for the production of batteries, and this will create promising jobs. Altmayer did not say exactly how many new jobs should be created. Estimates, however, range from 6,000 to 10,000.

Should German automakers fear competition?


Car expert Ferdinand Dudenhoffer called Musk's plans “good news” for VW, Daimler and BMW. Because: "Competition has always guaranteed that we are getting better and faster."

German automakers themselves also welcome this move. Bernhard Mattes, President of the German Association of the Automotive Industry (VDA), said: “If the plans are implemented in a few years, this will further increase electric mobility.” He noted that German manufacturers "already today” produce electric cars in Germany.

The German Institute for Economic Research (DIW) sees advantages for the German automotive industry: “Thanks to Tesla's production in Germany, the entire supply industry will be strengthened in this country.” In addition, existing capacities can be maintained and even new ones created if an additional buyer acts on the market.

Last but not least, East Germany will be among the winners. “East Germany as a whole would take a big step forward thanks to Tesla's huge investment in an important industrial future,” the expert said. The know-how and potential in the field of electric mobility and battery technology will be significantly strengthened in Germany.

 


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