Inside Tesla's gigantic Gigafactory

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WATCH: Tesla offers peek into battery factory

Does Elon Musk have more money than sense? Or could it actually be more sense than money?

The chief executive of Tesla is, in a post-Steve-Jobs world, the stand-out visionary voice in Silicon Valley. There's no question about that.

But with each product launch - or, in this case, a building launch - it seems he needs both more time and more money to realise his own ambitions.

The more he achieves, the bigger the task, and budget, seems to get.

Image source, Tesla
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The Gigafactory, about half an hour's drive from Reno, Nevada, is only 14% completed

During a typically scorching Tuesday afternoon in the Nevada desert, near Reno, Mr Musk told a group of journalists about his global manufacturing ambitions.

We had just had a tour of the new Gigafactory, Tesla's $5bn (£3.8bn) 3,200-acre battery-manufacturing plant that has already begun production but will not be in full swing until about 2020. At that point, it will have the largest physical footprint of any building in the world.

By making battery cells here, Mr Musk hopes he will be able to innovate faster and cut out about 30% of the cost.

The factory is a tie-up with the company that already makes Tesla's cells, Panasonic.

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Construction on the Gigafactory began in June 2014

The Japanese company has invested just under $2bn in the plant (not, apparently, enough to get the company's name above the door, I noted).

Panasonic's equipment, covered in tarpaulin - and not allowed to be photographed, like much of the building - would be raring to go in a matter of weeks, our guide said.

Other machinery was being moved in block-by-block, though the company was not prepared to give up many secrets.

On entering one room on the factory's second floor, our guide told us he was not allowed to tell us "what this is or what it does".


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The factory will eventually have more than 6,000 employees (though not right now...)

In one section of the factory, Panasonic will work on its cells.

When ready, they will be handed over to Tesla to continue the process.

This will happen though a hole in the floor, as opposed to over the Pacific Ocean as it does today.

But even as we were standing in the Gigafactory, marvelling at its scale, Mr Musk was telling us it was still not enough.

He was not content with one Gigafactory. No. What he really needed was one "in Europe, in India, in China... ultimately, wherever there is a huge amount of demand for the end product".

Gigafactory by the numbers

  • estimated cost of $5bn
  • total land area of 3,200 acres (13 sq km)
  • currently 14% complete, with 1.9 million sq ft (177,000 sq m) of operational space
  • when complete, it will have 5.8 million sq ft
  • 1,000 construction workers currently working on the project, which is two years ahead of schedule
  • aims to provide 35GWh of battery power by 2018 - that is more than the combined global production of batteries in 2014. Production could increase to 150GWh

"Where the shipping costs start to become significant, the obvious way to combat that is to at least put a Gigafactory on the same continent."

It is part of Mr Musk's nature to throw out lavish, expensive ideas in the same way people in the real world might discuss buying a new shirt or ordering a pay-per-view movie.

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The factory is being built section by section, so some manufacturing could begin before other parts of the site are finished

Granted, Mr Musk has invested a lot of his own money into Tesla's endeavours.

But it is investors who will bankroll his brainwaves - although Tesla has been helped, a little, by government subsidies around renewable energy.

Next up for Tesla, according to Mr Musk's "masterplan", published last week, are electric buses and trucks.

Oh, and easily installed solar-roofing, and energy storage for the public.

Ah, and a fleet of self-driving Teslas in every city and town to compete with Uber.

Asked on Tuesday how much his masterplan might cost to implement, Mr Musk replied: "Tens of billions," with a shrug.

More money than sense, then?

Maybe. But it is perhaps unfair to say that, when you realise that a lot of what Mr Musk says makes perfect sense - he just needs more (and more) money to get there.

Loyal investors

The Gigafactory is not some lavish vanity project - it is a solid vision of the future of manufacturing, a way of making batteries quicker, without lugging materials across the Pacific Ocean.

If all goes to plan, it will be 100% sustainable and able to contribute to making 500,000 electric cars a year, as well as other energy-storage technology that might actually end up being Tesla's real impact on the world.

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Elon Musk said his latest masterplan could cost "tens of billions" of dollars

And the Gigafactory could bring perhaps as many as 10,000 jobs to the surrounding area.

There are not many Silicon Valley companies doing that.

It is Mr Musk's big thinking that lures in the cash he so desperately needs.

But the sums need to add up quickly or his charm will wear off.

When asked by the BBC if the masterplan publication and Gigafactory opening event had been timed to counteract potentially bad news coming from Tesla's financial results due next week, Mr Musk was unequivocal.

"The first time I thought about the earnings call is when you mentioned it," he said.


But he will know that his promise that Tesla would become profitable this year looks off the mark - and that even if Mr Musk's loyal investors have backed him to this point, they may be questioning when, or perhaps if, the returns will start coming in.

And yet investors believe in Mr Musk because of the aura he has created. Imagine backing out now if he does end up changing the world.

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The site covers a total of 3,200 acres

We have already seen Mr Musk diversify the way he raises money.

In March, 325,000 people paid $1,000 each to pre-order the upcoming Model 3 car.

The scheme was meant to raise money for production but to also prove interest. Though now the pressure is on to meet that demand.

The refreshing Tesla approach is the opposite to that of the super-secretive Apple, but Mr Musk maintains he does not worry about other people stealing his ideas.

Referencing the SR-71 Blackbird jet, "probably the greatest plane ever", Mr Musk said as long as you were the quickest, you would never lose a fight.

And he is right - no Blackbird was ever lost to combat.

But the thrilling, ground-breaking jet was retired by the US Air Force in 1998 - after it was decided the vast sums of money needed to keep it in service could be better spent elsewhere.