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Dancing Musk Delivers First Teslas Drivers From New German Service Provider According to Reuters

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© Reuters. A worker sweeps the floor outside the new Tesla Gigafactory for electric cars in Gruenheide, Germany, March 20, 2022. REUTERS / Hannibal Hanschke

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By Victoria Waldersee and Nadine Schimroszik

GRUENHEIDE, Germany (Reuters) -Elon Musk was cheered as he oversaw the delivery of Tesla’s first German-made cars (NASDAQ:) at the Gruenheide plant on Tuesday, marking the beginning of the The American automaker’s first European hub just two years later was first announced.

Loud music played as 30 customers and their families got their first glimpse of their dazzling new cars through a neon-lit Tesla-branded tunnel, clapping and cheering as Tesla CEO Musk danced and joked with fans.

“This is a great day for the factory,” Musk said, describing it as “another step in the direction of a sustainable future.”

Although German Chancellor Olaf Scholz, who also attended the event, hailed the gigafactory as the future of the car industry, it was met with opposition and some environmental activists blocked the entrance to the house. machine while hanging banners marking its heavy use of water.

The two protesters stopped from a sign on a highway near the factory, blocking traffic for hours after the event.

Musk had hoped to start production from the plant eight months ago, but licensing delays and local concerns about the plant’s environmental impact have hampered the process.

Tesla has been forced to service European orders from Shanghai pending a German license, increasing logistics costs at a time when the company is grappling with industry-wide chip shortages and disruptions. other supply chains.

It was finally notified by the local government on March 4 to start production in Germany, provided it met conditions ranging from water use to air pollution control.

The factory opening comes the same day as America’s top securities regulator urged a federal judge not to let Musk back out of a settlement requiring oversight of his Twitter (NYSE:) usage. , which Tesla executives see as part of a harassment campaign.

RACE WITH VW

New owners have already received the Model Y Performance configuration, a car priced at 63,990 euros ($70,491) with a range of 514 kilometers (320 miles), Tesla said, adding that the orders were new. from the factory can be delivered from April.

So far, about 3,500 of the factory’s expected 12,000 workers have been hired, Tesla said.

At full capacity, the plant will produce 500,000 cars a year, more than the 450,000 battery-powered cars that German rival Volkswagen (DE:) has sold globally by 2021.

It will also generate 50 gigawatt hours (GWh) of battery power, surpassing all other plants in Germany.

For now, Volkswagen still has the edge in Europe’s race to electrify the fleet, with a 25% market share compared with Tesla’s 13%. Musk said ramping up production will take longer than two years to build the factory.

JPMorgan (NYSE:) predicts Gruenheide will produce about 54,000 cars by 2022, growing to 280,000 in 2023 and 500,000 in 2025.

Volkswagen, which has received 95,000 EV orders in Europe this year, is planning to build a new 2 billion euro EV plant in addition to its existing facility in Wolfsburg and six battery plants across Europe. .

But its timeline is slower than Tesla’s, with the EV factory opening in 2026 and the first battery plant in 2023.

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