In keeping with the ongoing trend of saving and preserving the planet by harnessing green energy, Tesla Motors Inc (NASDAQ:TSLA)’s CEO Elon Musk has taken a decision to construct a gigafactory for manufacturing batteries. Located in Nevada, the cost is expected to evolve into millions and possibly billions and the output, meaning batteries, will be supplied not just for Tesla but other uses too.
Will this bet by Tesla Motors Inc (NASDAQ:TSLA)’s CEO work? Cory Johnson discussed it on Bloomberg TV wherein he said that there were several factors which worked in favor of Elon Musk, the primary amongst which was that at present no-one has a better battery in the market. Adding to this is the fact that evolution and advancement in the field of battery technology has been really slow over the past century and that is why Musk has a good chance of succeeding.
Within a few more years, this factory of Tesla Motors Inc (NASDAQ:TSLA) will be fully operational and by 2020, the objective is to produce batteries for 200,000 Tesla cars. This in turn will also boost the production capacity of Tesla Motors, thus promising more revenue and higher profits. In the words of Johnson –
“This is really interesting I think, because of the big bets Elon Musk has made on this gigafactory, […] trying to turn this thing into giant factory to make somewhat cheaper cars, because of the somewhat cheaper batteries based on very old battery technology. So one of the big bets that Elon is making is that no one else will invent better battery for the next 20 years. All of the efforts that $2 billion spend by Federal government research and spent by companies like GM on trying to find a better battery which had failed thus far will continue to fail.”
If everything falls into place for Tesla Motors Inc (NASDAQ:TSLA) and more importantly Elon Musk, it could spell doom for the electric utilities because it would translated into minimal electricity bills, not to mention an eco-friendly source of energy.
This article has been written by Vinita Basu.