In a video titled “Game Over — Tesla’s AI Manufacturing Revolution,” Casgains Academy explained why Tesla’s AI manufacturing is so important, and also detailed the machines that actually set the company apart. Additionally, he explained why the other automakers will struggle to catch up (FUD believers, take notes).
The host, who doesn’t give his name, pointed out that Tesla’s investors were able to see the long-term direction that the company was heading toward. “Most important, they improved automotive gross margins despite lower regulatory credits, showing that Tesla’s becoming more efficient at manufacturing.
“Out of all of Tesla’s fundamentals, the progress at the gigafactories is paramount and has heeded Tesla’s domination in the acceleration of sustainable energy,” he said. This was due to the machines in the gigafactories that he believes set Tesla apart, and he dives into why “the gigafactories’ improving efficiency will obliterate the competition.”
Giga Nevada, which was once just one project, is now the main driver to Tesla’s current and future success, he noted in the video. Citing Giga Shanghai, Giga Texas, and Giga Berlin, he said, “Tesla’s ability to construct gigafactories has improved substantially since the construction of Giga Nevada.” Giga Nevada’s first phase took two years to complete. In comparison, it only took 10 months to complete Giga Shanghai’s first stage, and it cost Tesla 65% less. This shows “how Tesla’s gigafactory, the machine that builds the machine, is beginning to be built more efficiently.”
As for Giga Berlin, it is estimated it will be built in fewer than 11 months using precast concrete elements. And Giga Texas is estimated to have its first phase built by May of 2021. We’ve recently reported just how far along Giga Texas is and that it’s now being built 24/7, with 3 work shifts.
“In addition to the construction times accelerating downwards, Tesla’s Gigafactory outputs are increasing by substantial amounts through vertical integration of battery manufacturing,” he pointed out while comparing Panasonic’s impact with Tesla’s. “With Panasonic, a Gigafactory would have an estimated output of 150 gigawatt-hours. With Tesla’s vertical integration into batteries, a gigafactory would have an output of 1,000 gigawatt-hours,” adding that “Tesla’s production numbers are about to accelerate not linearly but exponentially.”
Tesla’s Elon Musk set a goal of delivering 20 million Teslas by 2030, and although many think that is either crazy or impossible, they are not considering that Tesla is constantly increasing the efficiencies of its gigafactories. “This starts to seem a lot more realistic,” Casgains Academy’s host pointed out. “Wall Street does not understand this and they’re about to be left in the dust once this plays out over the next five years.”
The host explained that what is driving Tesla’s growth is machines, especially Tesla’s casting machine, which is the largest in the world. He explained what casting is and why it matters by getting into the details of what a casting machine does. “The machine will take a single sheet of steel and mold that sheet of steel in order to fit the shape needed. In a matter of seconds, an entire body part of a car is completed. The larger this body part is, the faster production can be. Simplifying this process will be extremely important for maximizing output.”
The host uses a clip from Audi and compares it with a clip of Tesla’s Model Y casting machine, while noting that this is the largest casting machine ever made. “By eliminating 79 parts of the car, this saves 40% of the cost of the rear underbody compared to the previous Model 3.” He reminded us that at Giga Berlin, the Model Y’s underbody will be made from just one sheet of steel. In comparison, the Model 3’s underbody was made with 70 pieces of metal.
“This is the revolution of AI and machines that we’ve been looking for,” he said. “With the addition of Tesla’s Roadrunner sales at Berlin, the Model Y will have 370 fewer parts and 10% mass reduction purely off of the gigafactory’s innovations, yet none of these innovations come close to what’s about to happen at Giga Texas with the Cybertruck.”
He explained that the Cybertruck’s entire exoskeleton will be made from a single large sheet of steel. Legacy automakers use thousands of parts just to create one vehicle, but the Cybertruck will just need one casting machine to make its exoskeleton — made from one piece. This is important because not only will Tesla’s margins increase by substantial amounts, but the gigafactories’ output will also rise steeply — especially that of Giga Texas, which will have a much larger output than any of Tesla’s other gigafactories.
He explained that GM, which announced its new Hummer EV, has a massive price tag that isn’t even comparable to the Cybertruck. “When comparing the 250-mile range models together, the Hummer EV costs two times more at a price of $80,000,” while pointing out that the delivery dates for GM’s newest EV are in 2024. The Cybertruck, in comparison, will have its single-motor version come out late in 2022. “First-principles thinking and execution have propelled Tesla’s Gigafactory to be far superior to others,” he said.
Additive manufacturing of parts is still far too costly for cars, but can rapidly create tooling to accelerate pace of innovation.
It’s already sensible for rocket engine parts. To the best of our knowledge, SpaceX is 2 or 3 years ahead of other companies in use of additive.
— Elon Musk (@elonmusk) October 8, 2020
Additive manufacturing, which is more commonly referred to as 3D printing, “has massive potential for powering the next decade,” the host pointed out. Elon Must notes that additive manufacturing of parts is still far too costly for cars, but it can rapidly create tooling to accelerate the pace of innovation. “It’s already sensible for rocket engine parts. To the best of our knowledge, SpaceX is 2 or 3 years ahead of other companies in use of additive,” Elon said in the tweet above.
The host pointed out that Tasha Keeney from ARK Invest estimated that eventually, a lot of manufacturing operations will use 3D printers. “This isn’t very far off from Tesla’s vision, as they’ve been recently looking to get 3D printers at Giga Nevada.” The host noted that a new job post said that it should rapidly increase the production output of Giga Nevada. It should be noted that costs are more likely to be higher, and this will lower Tesla’s margins, but only in the short term. “When the economies of scale play out with 3D printers, it will start to make a lot of sense for improving the gigafactories’ efficiency. On a larger scale, because Tesla is becoming more efficient at frameworking and constructing gigafactories, the number of Gigafactories being built will accelerate faster than you think — especially with Tesla’s massive cash flow revealed in their third quarter.”
The host noted that local sources in Indonesia were in talks with Tesla about building a new Gigafactory there. This news was also announced back in October by Reuters, which noted that the country was in talks with Tesla on “potential investment.” The article stated that the government of Indonesia was in early discussions with Tesla about a potential investment in the country, which is a major producer of nickel. Ayodhia Kalake, who is a senior official at Indonesia’s Coordinating Ministry for Maritime and Investment, said that Tesla reached out to the government about a possible venture and pointed out that “it was still an early discussion and was not detailed yet,” while adding that “we need further discussion with Tesla.”
“Indonesia is the country of one of the world’s largest nickel producers, so this makes sense from a business perspective and I wouldn’t be surprised if this happens very soon,” the Casgains Academy host said.
Setting The Bar For Other Automakers
He noted that when Lucid Motors built its new electric SUV, many investors were shocked at how revolutionary the specs seemed to be. “This isn’t to hate on Lucid, but their manufacturing is in the early stage and it will be extremely difficult to even start manufacturing the Lucid Air.”
The host pointed out that Elon Musk has experienced production issues in the past in a very painful manner. At first, the Tesla Roadster failed at scaling up and missed deadlines, then the Model S and Model X. The Model 3 was a nightmare when Tesla was ramping up its production. “I’m sure that many of you know that Elon literally had to sleep on a couch inside the factory,” the host said, while getting to the crux of his point. “Tesla’s rapidly improving gigafactory was not all positive from the start, and it’ll be a rough journey for other EV startups to ramp up production,” he added.
He also mentioned that he is someone who wants other EV startups to succeed — as most of us do, actually. Tesla needs allies in this segment. Allies will help accelerate our switch to sustainable energy. “Because of Tesla’s lead, it’ll be difficult for other startups to compete on price,” though, he noted. You can watch Casgains Academy’s full video here for more.
Related CleanTechnica Exclusive: Elon Musk: “Tesla’s Long-Term Competitive Advantage Will Be Manufacturing”