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In a setback for electric vehicle giant Tesla, local residents in Brandenburg, Germany, have voted against the company’s plans to expand its battery and car assembly plant. The decision, reported by German state-owned broadcaster DW, comes as Tesla sought authorization to clear approximately 250 acres of forest near a nature conservation area for the expansion project.
Located in Grünheide, in the Brandenburg district about an hour’s drive from Berlin, the proposed expansion included the development of a rail freight depot and storage facilities. These additions aimed to reduce Tesla’s reliance on external logistics providers and mitigate production interruptions due to parts shortages.
Despite the vote being nonbinding, Tesla’s Vice President of Public Policy, Rohan Patel, stated on the company’s social network, X, that the outcome would not impact future expansion plans. Patel emphasized Tesla’s commitment to working closely with the community and all stakeholders to address concerns.
Earlier this year, Tesla’s German factory experienced a temporary halt in production for approximately two weeks due to a local component shortage, exacerbated by attacks on ships in the Red Sea by Houthi militants.
The Berlin-Brandenburg site, as referred to by Tesla, reported an annual capacity to produce 375,000 Model Y vehicles in the fourth quarter of 2023. Tesla highlighted in its recent quarterly filing that its international manufacturing facilities, including those in Germany, aimed to enhance vehicle affordability for local markets by reducing transportation and manufacturing costs.
Despite being a leading brand in Europe, Tesla faces increasing competition from a growing number of battery electric vehicle models in the region. According to the European Automobile Manufacturers Association, sales of new battery electric passenger vehicles in Europe surged 29% year-over-year in January, with Germany and France emerging as key markets for fully electric vehicles.
In January, Tesla’s sales represented 1.7% of the total passenger car market in Europe, encompassing fully electric, hybrid, and internal combustion engine models. Despite this setback, Tesla shares remained relatively flat on Wednesday, closing around $195 per share, though they have declined more than 20% year-to-date.