At 15:00 local time on March 22, Tesla's Berlin factory officially held a groundbreaking ceremony.
We see elon Musk dancing the familiar awkward dance, just as he did at the opening ceremony of the Shanghai Gigafactory. Behind this awkward dance is Tesla or Musk's own ambition for the European market.
With the Berlin Gigafactory, Tesla's delivery time in Europe will be greatly reduced. In Europe, the most electric car-friendly market, Tesla will seek a new big move.
The Berlin factory will help Tesla
Regaining the number one in the European market
The plant, which was announced in November 2019, was supposed to officially start operations in July 2021, according to Tesla's original plan. Despite all the typical European protests, the plant was finally put into operation, and the plant came at the right time.
At present, although Tesla is doing well in the European market, it is full of certain hidden worries. According to JATO Dynamics data, Tesla will sell about 168,000 vehicles in Europe in 2021, of which the Model 3 will sell 141,400 units, and beat the Renault ZOE to become the best-selling pure electric vehicle model in the European market.
But its market share of electric vehicles in Europe has slipped from a peak of 31% in 2019 to 13.9% in 2021, with Volkswagen and Stellantis leading Tesla with a share of 25% and 14.4%.
The emergence of this situation is not a decline in Tesla's product strength or brand power.
On the one hand, Volkswagen and Stellantis began to continuously launch electric vehicle models in the European market, especially Volkswagen's rapid launch of various models based on the MEB platform to the market, which posed a challenge to Tesla's market share.
Tesla Europe, on the other hand, relies heavily on the support of its Gigafactory in Shanghai. The Shanghai plant is already stretched thin to meet the needs of the Chinese market, not to mention the need to use capacity to meet orders from other overseas markets.
The first model to be put into production at the Berlin plant is the Model Y, and judging from the past experience of China and the United States, the Model Y as an SUV model can be favored by consumers. So in the absence of major surprises, the Berlin factory will help Tesla regain the throne of European market share champion.
Tesla has the capital to fight a price war in Europe
Considerable production capacity coupled with lower costs give Tesla the capital to fight a price war in the European market.
In terms of scale, the design capacity of the Berlin Gigafactory reached 500,000 units, of course, in the first one or two years, the relevant capacity ramp-up needs to be completed. However, in Tesla's current experience of operating factories, as long as it is not a strike or other black swan event organized by a strong union organization, Tesla's design capacity of 500,000 units will not take too much time.
According to the financial report data just released by Volkswagen, the global sales of MEB models in the entire 2021 are only 452,900 units. As for Volkswagen's next-generation SSP platform in Germany, it may not be until 2026 to launch the first model. In the next few years, Volkswagen will continue to be affected by Tesla in Germany and the European market.
The reduction in tariff costs will also be an immediate effect of local production. As one of Tesla's main sales forces, the Model 3 performance version of the model starts at 61,990 euros (about 435,300 yuan) in Germany, while the model is priced at 367,900 yuan in China. The relevant spread naturally includes the relevant freight and tariffs for exports from China to Europe. This fee will also fall sharply with Tesla's local production in Europe.
In the foreseeable future, despite the fluctuations in the price of commodities and rare metals, Tesla will be more comfortable in pricing products in Europe. Once the general environment stabilizes, the round after round of price war it has set off in the domestic market is likely to recur in the European market. At that time, whether Volkswagen and Stellantis could be undefeated in front of Tesla, which now has a bicycle gross profit margin of more than 30%, there is still a relatively large uncertainty.
Another point that has to be mentioned is that with the commissioning of the Berlin factory, Tesla's Shanghai Gigafactory can also free up its hands to better respond to domestic order demand.
Tesla's official website shows that at present, in the Chinese market, the pick-up cycle of most Tesla models has reached 16 to 20 weeks. It is true that China's smart electric vehicle market competition is also very fierce, but in the domestic market, there are almost no brands that can shake Tesla's position.
As the pressure to deliver model Y to the European market begins to decrease, the pick-up cycle of the Model Y, which is favored by consumers in China, will also be greatly shortened. In 2022, Tesla's sales in the domestic electric vehicle market will not only further climb, but are even likely to strive for a better position in the domestic SUV market rankings.
Mass production of the Model 2 is probably on the agenda
In Tesla's arsenal, the $25,000 entry-level, low-cost Model 2 is seen by all parties as a product with the ability to change the rules of the market.
The reason why Tesla has not launched this model is that tesla's current production capacity is already stretched to meet the existing models, not to mention the production of this model that will be in greater demand.
On the other hand, models with lower prices are likely to be inferior to existing models in terms of bicycle gross margins. Therefore, in the case of the market to maintain a relatively strong demand for existing models, Tesla does not have much power to mass-produce model 2.
But as Tesla's lack of capacity begins to ease, especially as the 4680 battery begins mass production, the production of Tesla's $25,000 entry-level model can be put on the agenda. After all, in Tesla's current situation, in order to achieve the goal of 20 million units in 2030, models such as the Model 2 are indispensable. Its mass production will not only significantly dilute the associated R&D costs, but also further consolidate Tesla's position as a leader in the global electric vehicle market.
If the biggest surprise of the groundbreaking ceremony of the Berlin Gigafactory, in addition to Musk's awkward dance, the presence of the new German Chancellor Schultz is also a big highlight.
As a european and global automotive industry powerhouse, Germany not only has luxury car brands such as BBA. At the same time, there are also large multinational car giants such as Volkswagen, which are the world's leading companies in terms of size and scale. Schultz's presence undoubtedly showed the outside world that the German government was not conservative. Even in the automotive industry, Germany still welcomes foreign companies to invest in Germany, pushing Germany to continue to maintain its leading position in the era of intelligent electric vehicles.
However, for the BBA and Volkswagen, in the era of smart electric vehicles, even if Germany or Europe is still their home field, the home advantage is constantly weakening. Facing tesla's challenge, there are still many lessons to be taken by germany's traditional car giants.
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