Tesla's (TSLA +2.45%) upcoming production facility in Europe has apparently suffered another delay. Tech news site Electrek reported on Friday, citing "reports coming out of Germany," that the company has been forced to halt the construction of its Gigafactory Berlin near the namesake capital city.
The reason, it seems, is that the company has not paid a required $100 million security deposit to Germany's State Office for the Environment on its potential demolition.
A Tesla Model Y, the first vehicle slated for production at the Gigafactory Berlin. Image source: Tesla.
According to Electrek, Tesla has not secured overall approval to construct the facility, opting instead to build it with only piecemeal, partial approvals. The website quoted German newspaper Die Zeit in its report about the situation:
Tesla is already allowed to build, although the final building permit has not yet been obtained. In the event that it is never granted, Tesla or another company will have to demolish what has already been built. The financial security deposit serves this purpose. The company has now been granted an extended period until January 4, 2021, to [make the] deposit.
It was unclear why construction was halted if the company received the extension; apparently, the original due date was Dec. 17.
If this dynamic sounds familiar, it should. In October, Tesla similarly missed a payment, and local authorities shut off the water supply to the project in response.
Tesla has not commented on either the Electrek or Die Zeit articles.
Any delay in the big facility is disheartening news, but at this point Tesla has such die-hard fans as shareholders it probably won't hurt investor sentiment all that much. Regardless, those interested in the company should keep a sharp eye on how this situation develops.
