Tesla Nevada plant changes leadership, sets new production targets

Tesla has reshuffled the leadership of its massive battery factory, the Gigafactory, outside Reno, Nevada, and set new goals for the plant.

Chris Lister, vice president of Gigafactory operations, has left and Hrushikesh Sagar has been promoted to head the super factory, according to audio from Thursday's meeting and documents shared by factory staff. Sagar reports directly to CEO Elon Musk and will also oversee Tesla's car assembly plant in Fremont, Calif.

On Thursday afternoon, Sagar spoke to hundreds of Gigafactory employees about management changes, performance reviews, plant milestones and aggressive new goals for the facility. He also revealed some information about progress at Tesla's plants in Austin, Texas, and outside Berlin, Germany.

Gigafactory workers make battery packs and powertrains for Tesla's electric vehicles, as well as the Powerwall and Megapack, the large backup batteries used by Tesla's energy division for sale. in terms of drive unit production, the Gigafactory produced 283,473 powertrains in the second quarter of 2022, "feeding" the company's electric vehicle fleet. "Feeding" the company's Fremont and Austin plants.

During the meeting, Sagar said Tesla's Fremont, California, plant had one of its record months for production in August. He said the Fremont plant is now capable of producing about 12,000 cars a week and that the next goal is to produce 14,000 cars a week.

He also said that Tesla's team in Brandenburg, Germany, recently reached a milestone of being able to produce 1,000 cars on a rolling seven-day basis. Musk recently toured the German plant, which the company expects to be producing 5,000 vehicles per week by the end of 2022. Tesla's new factory in Austin, Texas, has also reached production of 1,000 vehicles per week.

New leaders and new goals for the Gigafactory

Prior to joining Tesla in late 2017, Chris Lister spent 22 years at PepsiCo's Precision Manufacturing division. During his tenure at Tesla, the gigafactory has experienced rapid expansion and growing pains, including massive waste, fires and oil spills. But while increasing production at the China plant, he also helped make Tesla the best-selling electric car brand in the U.S. and the world. Sagar's new title is senior director of automotive operations and manufacturing engineering, according to his LinkedIn profile.

Sagar told employees Thursday that they should consider the Fremont plant their "customer," noting that the success of car production there depends on the volume and quality of shipments from the Gigafactory. While Sagar doesn't plan to spend most of his time in Reno, he plans to work closely with the plant's leaders, including energy executive Matt Reddick, who joined the company about six months ago, and base executive Eric Montgomery, who will manage day-to-day affairs in Nevada.

At the same meeting Thursday, Montgomery told Gigafactory employees that they need to reach a steady output of 8,800 high-voltage battery packs per week to support new production goals in Fremont and "maximize production of 4WD. He said August 2022 was also the second-best month on record for Gigafactory production, behind October 2021.

Reddick said Tesla can now produce 42 giant Megapack batteries in a seven-day rolling cycle. The giant batteries are about the size of a shipping container and are used for utility-scale energy storage, typically to store excess energy generated by wind or solar (000591) power. Tesla plans to produce 442 Megapacks in the third quarter of 2022, up 85 percent sequentially.

The Gigafactory is also meeting and exceeding production of 6,500 units per week of the Powerwall, a small home backup battery that Musk recently promoted on Twitter during a heat wave in California. The heat wave threatened power outages, and the state urged residents to cut back on electricity use during peak hours.

Tesla previously required customers who wanted to buy a Powerwall to also buy a photovoltaic roof from the company. montgomery noted that the Nevada Gigafactory produced 37,600 powerwalls in the second quarter and said the plant was aiming to increase production by 22 percent in the third quarter.

In terms of the facility itself, Tesla infrastructure executive Jeff Jackson touted a new, state-of-the-art water treatment facility Tesla is building on site. This will eliminate the discharge of our on-site process water or wastewater and will allow for 98 percent water recycling and evaporation," he stated. It's a big deal, and it's consistent with our mission."

Jackson also gave an update on the solar roof at the superfactory. The infrastructure chief said, "We currently have about 8 megawatts of power available on the roof that we use every day, which is really exciting."

On the human resources front, workers are being urged to reduce the number of labor hours required to produce the individual units of products they make in their teams and to submit more "accountability" notices on how to improve plant safety and reduce costs. An extensive performance review is underway.

One employee asked management if their equity award would be tied to the company's milestones this year, and management said no. But the human resources team and managers are still working on the project. But the HR team and managers are still considering who is eligible for promotions, raises and bonuses, and Sagar said managers should be discussing performance reviews with their teams by the end of September.

Employees are asking management to discuss whether and where Tesla's next factory will be built. However, Sagar said: "I have some knowledge of the candidates, but I don't think I have the right to disclose information about these candidates at this time because some things are confidential. There is an exciting future in North America and throughout the Americas."



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