Tesla Shares Surge 8% Following Reports Elon Musk Is Eying South Korea For Tesla’s Next Gigafactory
Tesla is currently undertaking a significant expansion of the company’s production capability. Tesla is simultaneously ramping production at a new gigafactory in Gruenheide Germany, and Austin Texas, and is expanding production capacity at its Fremont, California plant and Shanghai gigafactory.
According to Tesla’s Internal targets, in 2022, the EV maker plans to grow its production capacity by 50%. And by 2030 the company plans to grow vehicle production to 20 million cars a year. Elon Musk in the past has also said, Tesla plans to at least have one gigafactory in every continent the company sells its vehicles.
Due to Tesla’s ambitious growth plans, the EV maker is looking at several countries to pick the location for the company’s next gigafactory. This has meant sporadic reports claiming Tesla has chosen a certain country to build a new Gigafactory.
The first rumors began with reports claiming Tesla has chosen Karnataka, India as the site for the company’s next gigafactory. The rumors cite Karnataka state Chief Minister BS Yediyurappa who said in a statement “American firm Tesla will open its electric car manufacturing unit in Karnataka.”
Following, there were reports stating Tesla has chosen Indonesia as the site for the company’s next gigafactory. These rumors began due to Tesla’s Battery Day announcement that the company plans to significantly increase its nickel consumption and the mineral’s abundance in the country.
And today reports quoting unnamed sources in the office of the South Korean president suggest that the east Asian nation might be the sight for Tesla’s next gigafactory.
This report comes via Reuters which wrote “chief executive Elon Musk said on Wednesday that South Korea was among its top candidate locations for a factory it plans to build in Asia.” And added that “Musk had made the remark in a video call with President Yoon Suk-yeol, adding that the company planned to step up cooperation with South Korea on supply chains, Yoon's office said.”
Reuters also directly quoted Musk as saying “we expect to buy components worth more than $10 billion from South Korean firms in 2023 as we significantly expand supply chain cooperation with South Korean companies.”
— Torque News (@torquenewsauto) November 23, 2022
If indeed true, this is certainly exciting news both for South Korea and Tesla. South Korea also makes a lot of sense as the location for Tesla’s next gigafactory as the country already has a strong manufacturing pedigree and the demand for Tesla vehicles also appears to be strong in the east Asian nation.
For instance, Tesla began selling the Model Y in South Korea in April 2021 with an initial delivery of 9 vehicles. However, within just 2 months the Model Y became the most imported vehicle in the east Asian country.
The stock market also appears to have taken this news positively as Tesla’s stock price surged by 8% following Reuter’s report. After today’s rise, Tesla is now trading at around $183 per share, up from $169 at the opening of the trading day.
This is well and good however, as of now we only have one report that suggests Tesla has picked South Korea as one of the top candidates for the company’s next gigafactory. In addition, we have also seen similarly exciting reports concerning the site of Tesla’s next gigafactory amounting to nothing.
This means it is important to manage our expectations. However, we’ll be sure to follow the story and report back when we receive more concrete information regarding Tesla’s future plans. Until then make sure to visit our site torquenews.com/Tesla regularly for the latest updates.
Image: Courtesy of Tesla, Inc.
So what do you think? Should Tesla build the company’s next gigafactory in South Korea? Also, do you think this news warrants the 8% increase in the EV maker’s shares? Let me know your thoughts in the comments below
For more information check out: Tesla Earning 8 Times More Than Toyota Per Car Sold, With Sales 6 Times Lower
Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily