3 Surprising Things You May Not Know About Tesla Motors' Massive California Factory

An inside look at Tesla Motors massive 5.4 million square foot factory in California.

Aug 24, 2014 at 12:47PM

Tesla Motors (NASDAQ:TSLA) boasts one of the most technologically advanced assembly lines in the automotive industry today. I visited Tesla's massive 5.4 million square foot factory recently in Fremont, Calif., and was utterly impressed with the orderliness and layout of the facility. The unique corporate culture inside this massive plant was also noteworthy. Here are the key takeaways from my tour, including three surprising features that make the electric-car maker stand out in today's crowded auto market.

Anything but antiquated
As luck would have it, my visit coincided with the reopening of the factory after a two-week closure for system upgrades in preparation for the rollout of Tesla's Model X. The company expects the factory refit to boost production output by as much as 25%. Moreover, Tesla Motors' chief executive Elon Musk is confident that this capacity upgrade will allow Tesla to make more than 35,000 Model S cars this year. For those keeping track at home, that's a 55% increase over the 22,477 EVs it delivered last year. 

How, you ask? Technological advances in robotics are enabling Tesla and other automakers today to bring the automotive assembly line into the 21st century. The electric-vehicle maker added new robots to its body shop during the recent upgrade, as well as other equipment and a new final assembly line that will now process both Model S and Model X vehicles.

Tesla Robots Factory

Inside Tesla Motors factory in Fremont, Calif. Source: Tesla Motors.

A Tesla spokeswoman said:

"While the capacity expansion was a singular event to dramatically change the interior of the factory, we are always constantly improving the production process, adding new process and equipment, and adjusting many facets to provide a more efficient, safer, faster, and higher-quality workplace and product. It is a never-ending process of improvement." 

Many of Tesla's Kuka robots now perform two or three separate tasks. It begins with a Kuka robot inserting a huge aluminum blank into Tesla's Press Line, which then stamps the aluminum blanks into three-dimensional parts that are later welded together to form the body of the car. Next, these pressed and formed parts are sent to the body assembly area where an army of robots perform multiple tasks simultaneously. For example, robots on Tesla's body framing line bond, rivet and weld sub-assemblies into the form of the Model S. This is important because it significantly speeds up the production process. By adding more automation to its assembly line, Tesla will be capable of producing more than 1,000 vehicles per week, up from its current rate of around 800 cars a week. 

But robots haven't completely taken over. The machines' human counterparts perform many of the finishing touches to the EV's interior and powertrain. Moreover, Tesla's Fremont facility currently employs around 6,000 workers. That number could grow as Tesla ramps up production of its Model S and begins producing its crossover EV in early 2015.

Tesla Factory No Robots

Source: Tesla Motors. 

Room to spare
Tesla has plenty of space on hand for future output expansion at its Fremont plant. In fact, the EV maker is barely operating at 50% of capacity today. When the company purchased the factory from NUMMI (a joint venture between Toyota and General Motors) about four years ago, many investors worried that Tesla was getting ahead of itself because it was initially using less than 10% of the massive space. In retrospect, this was a smart move for the upstart auto company.

Another interesting tidbit is that Tesla first purchased the 380-acre Fremont property in 2010 for only $42 million. According to my guide on the tour, the property and facility is worth $2 billion today, though a Tesla media rep wasn't able to confirm this figure. 

Good Car-ma
The culture inside Tesla's giant factory is another noteworthy characteristic of the place. Nearly all of the 6,000 employees zip around the building on bikes and scooters adorned with everything from Tesla logos and colors to utility baskets and whistles. Tesla provides most of the bikes and they are available for anyone to use. On the frame, it says, "Property of Tesla, do not lock," so when a bike is available, a Tesla employee can just grab it and go. 

The factory's various cafeterias and cafes are another exciting facet of the building. Tesla provides free coffee, tea, soda, hot and cold cereal, as well as a changing offering of seasonal snacks and fruit, while large signs overhead read "Make healthy choices." This feel-good factory vibe helps promote Tesla's reputation as a company you want to work for.

There you have it... from high-tech robots to free food and drinks and plenty of factory space for future expansion, Tesla Motors' Fremont plant is a modern marvel of manufacturing ingenuity.

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Tamara Rutter owns shares of Tesla Motors. The Motley Fool recommends Tesla Motors. The Motley Fool owns shares of Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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