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Despite Bureaucratic and Environmental Regulations, Tesla Opens First German Factory

Elon Musk inaugura la primera fábrica europea de Tesla en Alemania pese a enormes regulaciones burocráticas

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German Chancellor Olaf Scholz and Minister for Economic Affairs Robert Habeck participated this Tuesday in the inauguration of the first Tesla factory in Europe, where they reaffirmed their commitment to electro-mobility as the technology of the future. 

Tesla’s CEO Elon Musk also attended the ceremony. He also handed over to their new owners the first 30 Model Y vehicles manufactured at the plant, featuring a futuristic setting and techno music as background.

“Thank you Germany,” the tycoon wrote via Twitter, after inaugurating the factory, located on 300 hectares near the town of Grünheide, just 3 miles from the German capital of Berlin.

“Electric cars will determine the mobility of the future,” declared Chancellor Scholz who stressed that the two-year construction period is proof that “Germany can be fast.”

Also, the Minister for Economic Affairs and Energy says the factory serves as an example of success and stated that he is making a “24 hours a day” effort to meet the coalition government’s goal of speeding up the tendering processes in the industry.

Habeck added that Tesla’s bid for the German site proves that the country is perceived as the “leading market” for electric vehicles, and predicted that private vehicles will continue to exist in the future, although with a tendency to be shared.

“That is why manufacturers are increasingly betting on becoming mobility providers,” the minister noted in a brief meeting with the press, in which he also highlighted the importance of electric vehicles to reduce the dependence on oil, as well within the context of the war in Ukraine.

 “Showing that we cannot only replace oil with oil, but also with electricity, is a nice symbol today,” he pointed out.

When the Grünheide factory is fully operational it is expected to put 500,000 vehicles on the market every year, in addition to electric batteries, and to employ 12,000 people.

The plant will manufacture what is known as Model Y, an electric SUV with four-wheel drive and dual motor, with autonomy to travel over 300 miles, and at a market price of around $63,000.

Germany’s bureaucratic hurdles

Since Tesla requested the corresponding permits in December 2019 until the start of production this March, over two years have passed—more than what Musk expected, as he was counting on the factory to start operating in the summer of 2021.

The company began the works with provisional permits and the bumpy process was not free of tensions with the local authorities, who even demanded a deposit of 100 million euros in case the plant had to be dismantled, which Tesla refused to pay.

In total, site plans had to be submitted a total of three times, and Tesla had to pay fines for installing certain structures without the appropriate permits.

In October, the plant finally celebrated an open house day, with construction almost complete; however, those responsible for the certification process were still reviewing more than 800 objections submitted by various entities.

In the final stretch, a court declared contrary to the right of the agreement to supply water to the factory due to a formal error, and the “Land” of Brandenburg had to intervene to enable the extraction.

The final permit arrived on March 4 in a 600-page letter that summarized the “titanic task” of the local administration. Several environmental organizations have already announced that they will take legal action against the decision.

The problem of water shortage in the region, on the other hand, has not been solved and experts believe that in the future it could be difficult for other companies linked to the factory to settle in the region.

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