Spaceship Campus vs Gigafactory

Discussion in 'Community Discussion' started by roow110, Jul 31, 2015.

  1. roow110 macrumors regular

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    #1
    construction.jpg

    Apple and Tesla have two of the most exciting construction projects going on simultaneously right now. Both companies are building some of the largest buildings in the world. However, as large as Apple Campus 2 is going to be, I was realizing recently it is tiny compared to the Gigafactory. I threw together this graphic comparing the size of both to show just how massive they are.
    Apple Campus 2 size comparison.jpg
     
  2. Prof. macrumors 601

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  3. east85 macrumors 65816

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  4. maflynn Moderator

    maflynn

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    #4
    Why in the world is Tesla building such an enormous building when not a huge company, they've not turned a profit and they only have one product (so far)?

    I'm not against tesla but not knowing the details, this is confusing.
     
  5. juanm, Aug 2, 2015
    Last edited: Aug 5, 2015

    juanm macrumors 65816

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    #5
    Because they expect to become a huge company, and have more products.

    So far there's Model S, but in the near future there's also Model X, Powerwall, and soon after that, Model 3.

    If they expect to sell millions of cars within five years, they plan ahead and build the largest factory they can. I sure hope they succeed, and I'm eager to see what they have in line for the 3.
     
  6. maflynn Moderator

    maflynn

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    #6
    There's planning to be a giant company and then there's building such an absurdly large facility when there is no need for so much space. Basically spending hundreds of millions on space that will largely be unused for the short and medium term.

    I mean if Apple is only needing their spaceship now, how absurd is it for a start up building an even larger building and they only have one product so far.
     
  7. Prof. macrumors 601

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  8. heehee macrumors 68020

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    #8
    They are going to release the Model 3 in two years selling 500,000 cars a year. Building the Gigafactory will reduce the battery cost by a chunk. This is also phase 1, they are planning to build phase 2 else where.
     
  9. juanm macrumors 65816

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    #9
    What can I say, it's a company that looks forward and plans ahead... Better to have empty floor space for two years, than to have to throttle production for four years.
     
  10. roow110 thread starter macrumors regular

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    Tesla is building the Gigafactory because they pretty much are guaranteed to have that demand. They are basically using 1/2 of the lithium ion batteries in the WORLD while being such a small company. Tesla hasn't turned a profit because they are scaling up to be a very large company. In less than 5 years they want to be producing a half a million cars.
     
  11. AustinIllini macrumors demi-god

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    #11
    Possibly. They either have to succeed in creating a car at the $35,000 mark or pivot to most of their business being batteries. At some point, Honda, Toyota, GM, etc will come to an understanding of what the future of automobiles is, and Tesla is going to want to sell to these guys. Reason being, Tesla seems content on being an upscale car brand.

    It's far more realistic to be profitable selling cars to a fraction of the population while selling a technology to every car company on the globe.
     
  12. east85 macrumors 65816

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    If I'm not mistaken Tesla patents are already leased to some major car companies, so they're going to be pulling in money from those for some time regardless of sales.
     
  13. McGiord macrumors 601

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    #13
    Tesla is not only about cars, it's about electricity.

    The federal regulations are almost impossible to meet by the traditional automotive practices and fuel fossil engines.

    Electrical vehicles and hybrids are the only known solution so far.

    Without a large scale volume the business case isn't there to lower the research and development as well as the mass production costs to turn a profit out of $30-20K or less vehicles.
     
  14. AppleDApp macrumors 68020

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    #14
    Is the gigafactory being only for battery production or are they also assembling cars there or is this just HQ?
     
  15. McGiord macrumors 601

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    As I understand is for batteries.
    They build their cars in California, what used to be GM-Toyota Joint Venture Nummi Assembly plant.
     
  16. AustinIllini macrumors demi-god

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    #16
    Actually, Tesla gave away several of their key technologies. In fact, most of their exploits with major automotive companies have been failures (the Rav4 comes to mind)

    Until the plant is built, Tesla isn't about anything. Federal regulations can be met with the proper technologies. R&D for all the major automotive companies can and will figure out the best technology. Tesla could be left out of the car industry if technology goes in a different direction. If this happens, expect Tesla to go to a much more battery centric model, where it will hit heavier competition from the energy companies than it will from the automotive industry. This would be a major problem for Tesla and its investors.

    It's for battery production. While it is unlikely the cars will be assembled there, the Model 3 depends on that plant being built, because Tesla cannot afford to build the car for the price point they want. Here is where the critical point comes. If you recall, NeXT computer was a company built to build a product and they anticipated sales with giant factories and large corporate structures long before they were profitable. Sun Microsystems undercut them severely, and the NeXT workstation went the way of the Dodo bird. If Tesla does not play its cards right and quickly, major automotive brands will figure out the future formula for automobiles and put Tesla at a huge disadvantage.

    Yes. That is correct.

    Tesla looks like the future at the moment, and it very well could be, but they have to get this factory built and the Model 3 out on time or they are going to have a huge problem becoming profitable.
     
  17. noisycats macrumors 6502a

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    #17
    This. And let's not forget the tie in between tesla and solar city. SC is predicted to be the largest energy distributer within the next decade. Batteries, large ones, fit into that plan.
     
  18. AustinIllini macrumors demi-god

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    #18
    This may be so, but it's very happy path. Tesla is on the clock and they need to generate more profit. That requires the Model 3

    Edit: There is no tie between Tesla and SC. The Tesla battery is incompatible with SC. Huge mistake.

    http://www.businessinsider.com/solarcity-says-no-thanks-to-teslas-new-battery-2015-5
     
  19. McGiord macrumors 601

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    AustinIllini:
    What is what you call proper technology to meet federal regulations?

    Traditional Auto OEM are relying on traditional methods to perform R&D and many times more worried about the immediate fix to cash in their executives bonuses than to deal with the long term company-customer-industry needs.

    Another area where Tesla or any other company may make a significant disruption to the automotive market is in the sales and customer service area. Traditional auto dealers suck and are a terrible experience for any potential buyer, or current customer. Lobbyist and state laws to "protect" these traditional business models are not really enabling a faster improvement in the business.

    The success of the auto industry always had been due to the commercial benefit of the energy business associates with it.

    Why other sources of energy aren't used to power automobiles?

    Water? Hydrogen? Nitrogen? Solar? Wind? Electrical? Permanent magnets? Etc...
     
  20. noisycats macrumors 6502a

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    #20
    Interesting read. But I still think the gigafactory will be doing more than just tesla batteries. If not, yes, huge mistake.
    No tie between the two? Lol.
    Current tesla wall batteries aren't suitable for SC, true. That's quite different from "incompatible".

    And we are taking about the future after all. Trust me, the two companies will be married at the hip.

    "SolarCity doesn't think one of the new Tesla batteries is right for its solar-panel business.
    Actually, the battery isn't right yet."

    They aren't building the gigafactory just to put batteries in cell phones.
     
  21. rhett7660 macrumors G4

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    #21
    Holy smokes this is one freaking huge building!!!!!
     
  22. AustinIllini macrumors demi-god

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    #22
    Let's be honest, here. First and foremost, all companies, including Tesla, exist to make their shareholders money. I have no doubt in my mind the big automotive companies will come up with a way to meet these regulations. No actual scientist would claim it to be impossible. The inherent bias in this part of the post really invalidates what little argument you made here.

    Obviously, dealerships are not a part of the buying process people enjoy. However, to predict that Tesla is going to change the world, yeah , they might. However, when demand rises, I doubt it will be as easy to go to a Tesla "dealership" and test drive a car as it is to go to a Toyota dealership and get into a car and try it. Scale up may do to Tesla what scale up did to Apple, it's still a strong product, but there are some obvious large holes in their model.

    Also, remember, you're competing against the like like of Mercedes, BMW, Audi, and Lexus. I'm pretty sure Lexus dealers are the undisputed champs of customer satisfaction.

    Tesla will have to get in bed with a number of companies including BP, ExxonMobil in order to truly be successful.

    Our infrastructure is not there and the tech isn't ready yet. A 200 mile electric range is a fine distance for a Tesla, but if I'm going 250 miles, I don't want to have to stop for half an hour 50 miles from my destination.

    Tesla is a view in to ONE potential future of the Automotive industry. It will likely take a global standard other than Petrol/gas (US) or diesel (Europe) before we move in a different direction. Realistically, only one or two technologies get to "win". It's unclear whether Electric is one of the winning technologies.
     
  23. McGiord macrumors 601

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    #23
    So...what is the technology that you have no doubt scientists will make successful?
     
  24. AustinIllini macrumors demi-god

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    #24
    Not sure. But if I had to bet full electric vs the field, I would take the field.
     
  25. darkknight14 macrumors 6502

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    #25
    I think TESLA will not become as big as people anticipate, the other car guys will catch up and deliver a knock out punch.

    At the moment its like Rocky vs. Apollo
     

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