“You could be right, because I haven’t seen evidence that electric cars are in such demand that money can be made by building such a plant.”
This car is a passing fad toy for the very rich. The demand will taper off. It will never be a mainstream car. We’re probably 50-100 years from an alternative vehicle that will beat gas and diesel. Five billion seems high for a battery factory. Very high. For the demand they have now it seems the batteries could be built by a contractor at a fraction of the price. But they’re taking the 100% high-risk path, which means they intend to fail. The top guys will bail on platinum parachutes.
This is 100% crony capitalism.
There’s no way Tesla is gonna lose money.
Musk is a Baraqqi partisan.
We have been waiting for decades for the miracle battery. All Tesla's engineers and all the taxpayers dollars cannot change the laws of chemical reactions. But it will be profitable. For those who made the correct donations.
I guess you are talking about the model S?
"For the demand they have now it seems the batteries could be built by a contractor"
They are not building this battery plant for the Model S. It is for the Model X and Model 3. The model X is a crossover vehicle and Model 3 is a low cost electric "for the masses". They are talking 500,000 cars per year.
As for a contractor, Panasonic is taking an equity position in this plant and it is entirely possible they will be manufacturing batteries for other electric car manufacturers.
He is selling cars but he is really selling batteries because that is the most expensive component in the car.
Remember when GE made appliances as a way to sell electric motors and controls. Eventually, electric motors became cheap and GE got out of that business, but they still make electric motors for train engines and turbines for windmills.