The German government is finalizing a subsidy package that could give Tesla (TSLA) over $1 billion in government funding for its new battery factory at Gigafactory Berlin.
After announcing plans to build a large electric vehicle factory in Berlin, Tesla confirmed that the project will also include a large battery cell factory.
It would likely become Tesla’s first in-house volume production of battery cells.
Around the same time that Tesla made the announcement, the German government announced plans to invest billions of dollars in encouraging local battery cell production to support local electric vehicle manufacturing.
Last year, we learned that Tesla applied for that government support.
Now, Germany’s Tagesspiegel newspaper reports that Tesla could be the biggest beneficiary of the new program and secure as much as 1.14 billion euros ($1.35 billion USD).
According to the report, they came up with the amount due to the number of jobs that Tesla plans to create at the factory, which could add up to 2,000.
Tagesspiegel reported (translated from German):
In Tesla’s new battery factory in Germany, by which the gigafactory for electric cars in Grünheide near Berlin is being expanded, significantly more jobs are to be created than previously known. The Federal Ministry for Economic Affairs and Energy (BMWI) , headed by Peter Altmaier (CDU), considers, as it explained to Tagesspiegel’s request, “with product and production success a number of 2000 or more jobs in the battery area of the plant in Grünheide is realistic”.
This is apparently signficantly more than in any other application.
It’s also not clear how much Tesla plans to spend specifically on the new battery factory, but the automaker has previously indicated plans to spend as much as $5 billion on Gigafactory Berlin and employ over 10,000 at the factory.
The new factory would become Tesla’s new production hub in Europe and supply EVs for local European demand.
The government is expected to make a decision on Tesla’s application by the end of the year.
Tesla has recently indicated plans to start production of the Model Y at Gigafactory Berlin in October.