Tesla Cyber Rodeo event is finally happening, and the opening of Tesla Gigafactory Texas is being celebrated. The new car assembly plant will help fuel EV leaders focus on carbon emission reduction. Here are some that are to be known about Cyber Rodeo and what to expect from the factory in the coming days.
Tesla dubs its factories with the giga prefix. Giga is the numerical prefix for billion. The practice likely came from the batteries. EV makers measure battery manufacturing capacity in gigawatt hours. A gigawatt hour of annual battery-making capacity can produce enough batteries to make, perhaps, 10,000 to 15,000 electric vehicles a year. Furthermore, the Cyber part in the “Cyber Rodeo” refers to Tesla’s pickup truck called the Cybertruck that eventually will be made in Austin. Also, Tesla won’t make Cybertrucks for months. The company’s first product at the new plant will be the Model Y. The party should start around 4 p.m. local and run until midnight. Global Equities analyst Trip Chowdhry wrote recently that Gov. Greg Abbott and Sen. Ted Cruz are expected to speak.
The plant has taken roughly two years to build and is designed to produce about 500,000 cars in its initial configuration. Tesla likely will expand the plant in the future and add battery-making capacity on site.
In the coming days, investors can expect videos of tours that show advanced robotic car assembly and new paint facilities. All new car plants use modern technology. Robots aren’t news, but Tesla still pushes the boundaries of manufacturing technology. The company is adopting giant die-casting presses that form part of a vehicle frame from molten aluminum. The technology is designed to reduce the amount of welding needed to make a car.
It will take time to ramp up capacity at the new plant. Analysts estimated the plant might produce 100,000 vehicles in 2022. Full production rates should be reached in about a year, assuming there are no more supply-chain problems like a lack of semiconductors. A chip shortage has constrained automotive production for more than a year.
Piper Sandler analyst Alexander Potter calculated that Tesla’s most productive plant in Shanghai can produce roughly 3,400 vehicles a day. That’s about 1.2 million vehicles a year, but car plants typically can’t run full out all year. That’s the kind of production number Tesla will want from Austin in the coming years. Achieving that level in Texas also will require more capital investment.
Tesla stock reacted positively to the opening of the German plant near Berlin earlier this year. The German plant was opened officially at the end of March. Coming into Thursday trading, Tesla stock has risen about 5% since then. The S&P 500 and Dow Jones Industrial Average have declined about 0.9% and 0.3%, respectively, over the same span.