It doesn’t matter if you’re in grade 4, a world-leader, or a high-flying millionaire: everyone loves going on a field trip. If that field trip includes high visibility jackets, safety eyewear and a hard hat, it’s even more appealing.
Field trips are also a great way of curbing negative press, showing your honored guests — and the wider world — that everything is as it should be, although we note that it can also convince those with more suspicious tendencies to doubt things further.
So when we tell you that Tesla Motors [NASDAQ:TSLA] recently held its own Board of Directors field trip to the Tesla Gigafactory site in Reno NV as it was shooting down claims that construction had dramatically slowed on the monster lithium-ion manufacturing and reprocessing facility, we suspect there are two ways this story will be viewed.
Before we go any further however, we think it’s time for a quick recap on the current situation as we understand it at the Gigafactory site in Reno, Nevada, and some of the claims being made against Tesla.
Costing Tesla an estimated $5 billion to build, with another $1 billion in investments from battery manufacturer Panasonic and $1.25 billion in tax breaks and perks from the state of Nevada, the Gigafactory will ultimately employ 6,500 workers and churn out an estimated 50 Gigawatt-hours of battery packs every year. Some of those packs will be used in the highly-anticipated, $35,000 Tesla Model ≡ Electric sedan. Others will be used in Tesla’s recently-announced home-based battery backup system.
With both projects promised to be on the market by 2017, Tesla has set itself a tough time frame for construction: finish the Gigafactory construction in just over a year and be producing lithium-ion battery packs there by the start of 2017.
When we last checked up on the progress of construction at the end of last month, we noted that while construction had indeed progressed at speed since January, there was barely anyone working on site. At the time, we thought little of it, thinking our contact Bob Tregilus had visited at a shift changeover period or perhaps a point outside of normal construction times. Shortly after making that assumption in our post however, Tregilus contacted us to confirm that he had taken February’s photographs during the middle of the day — 1pm on a Wednesday afternoon — just as he had in January. A time of day when you’d expect the site to be busy with construction workers.
Then two weeks ago, we started to hear rumblings suggesting that workers had been laid off at the plant or had their shifts reduced, something that seems to have happened around the same time that Tesla replaced the old ‘Project Tiger” construction sign that originally marked the construction site with its own distinctive white-on-red Tesla logo.
Not one would talk publicly, even as an anonymous source, but then on Friday last week, Reno’s local newspaper, the Reno Gazette-Journal, ran a story citing a slowdown of work at the Gigafactory which one particular union was blaming on last-minute changes to the design of the 1,000 acre facility.
It quoted the local chapter of the International Brotherhood of Electrical Workers, which had posted a message about the Tesla Gigafactory on its job referral page, saying that ‘The major project in the area has been delayed at this time,” and that “Further updates will be posted as soon as we know more.” When questioned directly about the Gigafactory by the Reno Gazette-Journal however, a representative for the IBEW Local 401 declined to comment about the postings, citing a non-disclosure agreement with Tesla Motors.
The Building & Construction Trades Council of Northern Nevada also declined to comment in detail, also citing NDA obligations, but did confirm that “there has been a reduction in hours” at the Gigafactory site.
Tesla, or rather its CEO Elon Musk, disagrees vehemently. In a series of tweets made over the weekend — at least one of which now appear to have been deleted — Musk shares some of the photographs taken by members of the Tesla Board of Directors, and disputes the rumors of a slowdown.
Some shots of the Gigafactory pilot plant (~20% of full size) under construction https://t.co/OzLzD4LsGW
— Elon Musk (@elonmusk) March 7, 2015
A second tweet from Musk — now deleted — read: “Media reporting solely off random job ads board in Reno that we didn’t even know existed. That is as dumb as it sounds.” While we can’t embed the tweet itself, there are many references to the tweet online, including this one from local AP reporter @RileySnyder:
Musk’s final tweet on the rumors is far more measured.
There is no slowdown of the Gigafactory construction underway, as anyone near Reno with eyes can verify. It’s not subtle.
— Elon Musk (@elonmusk) March 8, 2015
Our local contact Bob Tregilus finds Musk’s most recent tweet difficult to corroborate. “To counter Musk’s assertion that ‘anyone near Reno with eyes can verify. It’s not subtle,’ I recommend you compare photos from January and February,” he said to us earlier via email. “From the angle that I shoot the photos, the factory is on the right and there’s a square leveled area with two popup tents to the left of the factory site,” he continued. “That’s the construction worker’s parking. And then the construction offices are further to the left. Both sets of photos were taken during normal working hours.” Citing this recent aerial photograph below, Tregilus notes there are no cars in the parking lot, and that the building framework — which we had erroneously said was ‘60% complete’ in a previous post — accounts for approximately 1 million square foot of the total 1,000 acre site.
Regardless of construction for the Gigafactory being on schedule or not — something only those privy to the intricacies of the project management process for the site can really confirm — we have to admit that the photographs taken by some of the Tesla Motors Board of Directors on their recent field trip certainly seem devoid of construction workers.
The photographs come courtesy of Steve Jurvetson, managing director of venture capital firm Draper Fisher Jurvetson and currently on the Board of Directors at both SpaceX and Tesla Motors. Jurvetson, one of Tesla’s oldest investors, was among the first customers to drive a Tesla Roadster, and became the first ever Tesla Model S customer back in 2012 when he took over the keys to the first production Model S.
According to the information shown on Jurvetson’s Flickr page, the Tesla Gigafactory field trip occurred last week on the 3rd March.
As the first company to ever dare such a large construction project for a single lithium-ion manufacturing facility, Tesla Motors does indeed have a tough time ahead of it, especially given Tesla’s own time-frame which requires construction be completed and ready to produce lithium-ion battery packs by the end of next year.
Without meeting that target, Tesla Motors will not only find itself facing increased construction costs but also the delay of the promised 2018 Tesla Model ≡ ‘affordable’ long-range electric car. Slated to cost around $35,000 and have a range of at least 200 miles per charge, the Tesla Model ≡ is Tesla’s gateway out of the premium market segment and into the everyday car marketplace, something Tesla CEO Elon Musk has always maintained is necessary in order to affect a global change away from gasoline towards clean, electric cars powered by renewable electricity.
Here at Transport Evolved, we’re undecided as to how to interpret these latest Gigafactory developments. At the moment, we think it’s impossible to predict the completion of the Gigafactory, since it relies on so many different variables coming into play. Given Tesla’s determination and need to see it complete on time however, we suspect the Californian automaker will do everything it can to ensure that those first battery packs are rolling off the production line in twenty months’ time.
Do you agree? Do you worry that things aren’t looking as busy as they once were at the site? Or do you think there’s a perfectly understandable reason for the apparent slowdown?
Leave your thoughts in the Comments below.
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