Tesla Reportedly Shifting Battery Production from Germany to Texas

In a move that suggests there’s even more trouble at Tesla’s German factory than previously reported, the electric automaker appears to be taking a step back and shifting its focus to its Austin, Texas facility. A report from Handelsblatt first covered by Electrek says problems with battery production have led Tesla to begin moving manufacturing equipment out of Germany and into Texas.

Assuming the report is accurate, that represents a major change in strategy for Tesla, not simply a pause or short-term adjustment to its plans. Unfortunately, details on the specific problems Tesla is reportedly dealing with in Germany remain sparse:

The fact that Tesla will not start full battery cell production in its German plant in Grünheide for the time being apparently has other reasons than lower energy costs and new tax incentives in the USA worth billions. Several sources close to the electric car manufacturer report a significant delay in a crucial but highly complex production technique.

That doesn’t mean Tesla is completely done with its plans to produce batteries in Germany, though:

This is not a rejection of Grünheide. Tesla boss Elon Musk wants to continue to build a battery cell plant in Brandenburg in the long term. But before that, the electric car manufacturer has to get the so-called dry coating of the electrodes under control. A total of five experts, two of whom are close to Tesla, report that test systems with the technology are currently running quite successfully, but that implementation in large series is lacking.

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Tesla’s decision to change course on its battery plans does, however, appear to be a separate issue not directly related to its failure to get approval to expand the factory. Back in September, the city council rejected Tesla’s application to add “a freight station, logistics area and parking spaces” to its property. That issue may not be revisited until the end of next year.