Tesla Forms New German Division To Boost Production Of Electrical Cars To 500K By 2018

Tesla has set another output target this Tuesday. Elon Musk’s electric car and sustainable energy company now plans to produce 500,000 vehicles per year by 2018, and it plans to do so after acquiring German firm Grohmann Engineering.

In a blog post, the Tesla Team expressed that becoming a high-volume factory would entail production of high-quality products that are more affordable and accessible to the world. The Team then announced that the company has entered a deal to acquire Prüm, Germany-based manufacturing company Grohmann Engineering.

The agreement that has been entered into by the two firms marks the formation of Tesla Advanced Automation Germany, which will be responsible for helping the Fremont, Calif. factory reach the company’s goal for its electrical vehicle production that is expected to see a huge jump from 80,000 cars in 2016 to 500,00 units two years later.

Part of the deal states that Grohmann Engineering founder and CEO Klaus Grohmann will be onboard Tesla’s new plans, and he gets to keep his position as leader. “Companies are people, and we’re very honored that [founder Klaus Grohmann] will be staying on. That makes a big difference,” Musk was quoted as saying by The Verge.

To ensure that production would see a significant growth, Tesla also plans to hire 1,000 engineers and skilled technicians in Germany to work with the 700 existing employees of the German firm in the next two years.

The acquisition does not come as a surprise, since Tesla and Grohmann have been partners for several months now. Tesla CTO J.B. Straubel believes that this union will yield more and benefit both parties. Moreover, Straubel says the pool of engineering talent that is present in Germany is one of the primary reasons why Musk’s company decided to invest in the country.

Nevertheless, it is undeniable that a big reason why Tesla is acquiring Grohmann Engineering is for the company to reach its ambition of transforming into a mainstream car manufacturer with the launch of the Tesla Model 3, the affordable electric car that will cost only $35,000, as per AppleInsider. Realizing this ambition is not too far-fetched, though, given that preorders for the car have been very intense.