Wedoany.com Report-Dec.17, Tesla has announced plans to establish production capacity for up to 8 gigawatt hours of battery cells annually at its gigafactory in Gruenheide, near Berlin, Germany, with operations targeted to begin in 2027.

The company is committing an additional investment in the three-digit million euro range for cell manufacturing equipment and facilities. This brings the cumulative investment in the on-site cell production unit to nearly 1 billion euros ($1.2 billion).

"The aim is to increase the vertical range of manufacture at the site: everything from battery cells to vehicles will be produced at a single location. This is unique in Europe and also strengthens the resilience of our supply chains," Tesla said in its statement.

The company further noted that, provided suitable conditions are met, the complete battery value chain could eventually be consolidated at the Gruenheide location.

"If the conditions are right, the entire battery value chain will also take place in Gruenheide in the future. In international competition with China and the USA, it is currently hardly possible to produce cells economically in Europe."

The Gruenheide facility currently employs approximately 11,500 workers and serves as Tesla's sole European gigafactory. The plant already assembles electric vehicles and is now expanding deeper into component manufacturing.

This expansion represents a significant step toward greater integration of production processes, allowing the facility to handle multiple stages from raw cell output through to finished vehicles under one roof.

Such vertical integration offers potential advantages in supply chain stability and operational efficiency, particularly in a region seeking to build competitive capabilities in electric vehicle technology.

The decision to deepen investment in local cell production highlights Tesla's commitment to its European operations despite varying market dynamics across the continent.

By concentrating key manufacturing activities at a single site, the approach aims to streamline logistics, reduce dependency on external suppliers, and enhance overall responsiveness to demand fluctuations.

The Gruenheide gigafactory plays a central role in serving European customers, contributing to the region's growing electric vehicle infrastructure.

Battery cells remain a critical component in electric vehicles, influencing both performance characteristics and cost structures.

Expanding domestic cell capacity supports broader industry efforts to develop robust regional supply networks for advanced energy storage solutions.

The planned output of up to 8 gigawatt hours per year would substantially boost the site's contribution to Tesla's global battery requirements.

This initiative aligns with ongoing developments in sustainable transportation, where localized production can facilitate faster adaptation to technological advancements and market needs.

Overall, the investment underscores a strategic focus on building comprehensive manufacturing ecosystems capable of supporting long-term growth in electric mobility across Europe.