‘Here comes the battery factory,’ says Arne Christiani, pointing to a concrete frame surrounded by white tents on swampy ground. “And there,” in a huge dark gray hall with a band of mirror glass, “the bodies are made.” He drives around the 300-acre Tesla factory site.
Arne Christiani, mayor of Grünheide since 2003, has fought for years to attract a serious employer to his municipality in the German state of Brandenburg. In 2019, his efforts to boost the region were rewarded: Elon Musk decided to build his European Gigafactory in the forest south of Grünheide. Christiani: “It’s like winning the lottery.”
Now, less than two years after the first tree was felled, the first electric motors and bodies are being produced. The speed with which the factory was built from the ground is impressive in Germany. Also on Christiani: “I find it fascinating to see how quickly construction is taking place and how flexibly existing plans are adapted and improved.” German entrepreneurs can learn something from this flexibility, believes Christiani, an enthusiastic sixties with tinted lenses. Beside him in the car is a half-liter can of energy drink, as if to keep up with the musky West Coast pace.
The state of Brandenburg subsidizes Tesla’s factory with hundreds of millions of euros
The arrival of Tesla has not only turned everything upside down in Grünheide. Tesla acts as a mirror for German industry and bureaucracy: Musk is building his factory with ruthless speed in the car country, while the German colleagues are still struggling with the transition from fuel to E-car. The speed with which the factory is being built makes the slowness of German construction projects painfully visible. The neighboring Berlin airport BER, for example, was to be built in five years and was only ready after fourteen years. Musk’s investment in temporary roads, his own railway, and above all in the factory, while he does not even have all the permits, is unthinkable for risk-averse Germans.
Responsible for the arrival of Tesla is the Minister of Economy of Brandenburg, Jörg Steinbach, now also known by the nickname ‘Mister Tesla’. Steinbach also admires Musk’s entrepreneurial spirit. As for the minister, German entrepreneurs should take an example from Musk: “I even think that becoming more like Tesla is not just an option, but that it is a necessity for German companies to take more risk if they are on the want to remain competitive in the international market.”
The speed with which the factory is being built makes the slowness of German construction projects painfully visible
With this, Steinbach is referring to the flexibility, speed and risk that Musk took: the last permit before the factory can sell the Tesla Y’s already produced is not expected until the end of February. If Tesla does not receive that environmental permit, the company will have to tear down the factory again at its own expense. “In Germany everything is done in the traditional way: first everything is planned down to the last detail, then permits are applied for, then construction takes place and only then is it put into use. At Tesla, those phases were much more parallel.”
Tesla began building on provisional permits and tweaked plans during construction. For example, it decided in the summer to also produce battery cells on site. Last Wednesday it was announced that the German government that took office in December wants to simplify the German permit forest with a view to Tesla.
Not everyone applauds the mentality of ‘move fast and break things‘ who has now landed in Grünheide. Manu Hoyer, co-founder of the citizens’ initiative that has opposed the arrival of Musk and his electric cars from the start, points out that Germany has these extensive procedures for a reason. They serve the protection of citizens and the environment. According to her, the felling of the more than 50,000 pine trees in February 2020, less than three months after Musk’s decision to settle in Germany, happened much too quickly. “On the first day the sky was black with crows and ravens.”
Battery Knowledge
When Minister Steinbach talks about the inflexibility of German companies, he also refers to the car industry. The fact that Tesla decided to open a new factory in Germany is seen by many as a provocation by established companies such as BMW, Daimler (Mercedes) and Volkswagen.
In recent months, they have been trying to reduce Tesla’s lead as best they can. According to analysts, Musk’s company is far ahead in electrification and software development, and sales continue to grow – the new factory is there for a reason. Traditional German car builders, traditionally mainly metal workers, throw tens of billions of euros into bringing in software developers and building battery knowledge. Volkswagen will pay 73 billion euros over the next five years.
BMW, Daimler and Volkswagen (also Seat, Skoda, Audi) are the opposite of Tesla in every way. Decision-making is slow in these gigantic concerns, the culture is hierarchical. Complex interests are involved: employees have many rights, sometimes governments are shareholders. At Volkswagen (by far the largest German car company, with 660,000 employees worldwide), the state of Lower Saxony and the works council participate in the supervisory board discussions. Job retention is often a top priority for them.
In short, the German manufacturers are starkly different from Tesla. And they know that. Volkswagen CEO Herbert Diess simply admits that his company is lagging behind, in the hope that this will motivate the staff. „Tesla expected [in Brandenburg] 90 cars per hour,” said Diess at the end of 2021. “A total of ten hours is needed per car.” In contrast, he mentioned the figures of a Volkswagen electric car factory in Zwickau: 30 hours per car. “Tesla sets the standard.”
The American entrepreneurial mentality also encounters reservations among the unions. Tesla is known – like other American tech giants, Amazon for example – to have little to do with unions and other employee representatives. That may be common in America, but that attitude is unusual in Germany. The industry union IG Metall, with 2.3 million members, cannot be ignored by any company in Germany, just like the right to a works council.
An early letter from IG Metall never received an answer, according to the union. And Tesla has registered the Grünheide plant in a complicated way, which limits employee influence. That was the reason for IG Metall to open an office in the station building of Grünheide a few months ago. There, staff arrive by train to transfer to buses to the factory. At that station, the union recruits members and provides employees with information.
Although, according to the union, many interested parties show up in the brick office along the railway, IG Metall is having a hard time getting a foot in the door at Tesla. A works council will be elected at the company in mid-February. The union criticizes that time, because the Works Council will then be mainly occupied by employees from “middle management” – after all, few production personnel have been hired yet. Although the union has only a vague impression of the employment contracts, it has already stated for a few weeks that they are with certainty that they are less favorable than with other car manufacturers.
If Tesla succeeds in keeping IG Metall out, it could have a major impact. Ferdinand Dudenhöffer, a renowned analyst for the German auto industry, told Bloomberg news agency it could give other automakers an advantage in union negotiations: why would they still talk to IG Metall if competitor Tesla doesn’t?
groundwater level
Critics believe that the Brandenburg administrators have made it far too easy for Elon Musk. They would have welcomed him with open arms, only to then ignore workers’ rights and sneer at concerns about local wildlife. In August, Musk guided then-Chancellor candidate Armin Laschet around the grounds; to a journalist’s question whether the factory would adversely affect the already too low groundwater level in the area, Musk burst into cackling laughter and said “there’s like water everywhere”. The area does indeed have many lakes, but the groundwater level has been falling for decades.
According to environmental activist Hoyer, the drivers have allowed themselves to be taken over by the “richest man on earth”. Mayor Christiani indeed speaks with admiration about Musk, his life course, his space program. In October, Tesla invited all villagers to the factory site, Christiani says, and skeptical citizens also ‘went around’. “When Musk took the stage at 6 p.m., the audience erupted into cheers. I wouldn’t know which rock star in the world is more acclaimed.”
On the phone, Minister Steinbach says: “Have I rolled out the red carpet for Musk? Yes, we did everything we could to get Tesla to Brandenburg. But the same laws and regulations apply to Tesla as to any other company.”
Part of the schemes, which also apply to other companies, is that the state subsidizes about 10 percent of the investments. Because it is not yet clear exactly how much Tesla has invested, the subsidy amount is not yet known – but in any case it concerns hundreds of millions of euros. Tesla waives a possible European contribution of more than a billion euros for the battery factory, according to analysts, because the company would have had to give up too much of its battery technology to do so†
The municipality is also coming to meet Tesla. The old Grünheide station will be moved so that workers can get off closer to the factory. For the village this means that they are on the road a little longer. Earlier, Tesla bought a piece of railway line right next to the factory site to supply building materials. Now a provincial road is also being built to make the site more accessible, and an existing road is being widened to four lanes at Tesla’s expense.
Mayor Christiani says it’s all worth it. When the factory is fully operational, Tesla will provide 12,000 jobs. According to estimates, about 30 percent of the workers will come from Brandenburg, and 50 percent from Berlin – thirty minutes by train. Soon that train will stop three times an hour instead of twice, the mayor exults.
He is convinced that the Tesla momentum will radiate to the entire municipality. “For decades we have lost the generations between youth and seniors,” Christiani says, beating his desk with the flat of his hand. “We have excellent schools, and already five universities in the area. But what do people do after that? They pack their things and leave for old West Germany over the Elbe. In this way, nothing remains of sports associations, the voluntary fire brigade, the carnival association.”
With the arrival of Tesla, Christiani believes, all that will change.