Tesla’s Elon Musk: “We’ll Break Ground on Lithium-ion Gigafactory Next Month”

Groundbreaking at one of two sites chosen by Tesla as a prospective future site for its massive lithium-ion cell and reprocessing Gigafactory facility could take place as early as next month, Tesla CEO Elon Musk revealed yesterday.

Tesla will break ground on the first Gigafactory site within a month.

Tesla will break ground on the first Gigafactory site within a month.

Just one week after Tesla Motors [NASDAQ:TSLA] announced it would be picking two, not one locations to develop as Gigafactory sites up to and including groundbreaking in order to ‘minimize delays,’ the announcement was made my Musk himself on a conference call following the release of Tesla’s first-quarter 2014 earnings.

Answering questions from the media and business analysts, Musk said that ground breaking at the first location would probably occur next month, with the second site following with its groundbreaking in the next month or two after that.

Interestingly too, Musk now says that California is still being considered as a potential Gigafactory location, despite being discounted early on in the Gigafactory hunt due to its lengthy permit process and red tape. Referring to the hard work done by California Governor Jerry Brown and his staff, Musk said the state was no longer an “improbable” location, which makes us wonder if one of the two Gigafactory sites will end up on Tesla’s back door in California itself.

Expected to cost an estimated $5 billion to build and prepare for cell production, the Gigafactory will require a plot of land in excess of 1,000 acres. It will also employ more than 6,500 staff.

While California wasn't originally considered for a Gigafactory site, Musk says it is now in the running.

While California wasn’t originally considered for a Gigafactory site, Musk says it is now in the running.

Interestingly too, both Musk and Tesla CTO JB Staubel confirmed that Panasonic — who was initially pegged as a Gigafactory partner and then rumored to have pulled out — is still working alongside Tesla on the Gigafactory.

“We are talking to various different people in parallel,” said Staubel, noting that the Japanese electronics giant is “quite comfortable” with working together with Tesla, and a final partnership agreement would be due “sometime later this year.”

While the details of any partnership agreements are still being kept quiet, Tesla also says it is quietly confident that the Gigafactory will, when up and running, produce the 30 percent drop in lithium-ion battery cell costs.

Given the speed at which the Tesla Gigafactory is progressing, that’s good news for the entire industry as well as Tesla — who admits at the current time that Model S production volume is being constrained by limited lithium-ion battery cell availability.

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