Boston, MA 08/27/2014 (wallstreetpr) – Tesla Motors Inc (NASDAQ:TSLA), the automaker behind the all-electric car, Model S, recently put its Fremont, California, factory on hold for two weeks and then reopened it. The move to shut the plant for some time was motivated by a desire to expand its capacity, which was achieved in about two weeks, and work has resumed. The company also has plans for battery manufacturing plant known as “Gigafactory” in which it intends to invest about $5 billion.
The improvement of the Fremont facility resulted in the creation of a bigger second-floor space where the company assembles stationary batteries. The batteries are used by residential and commercial properties to store power drawn from solar panels. The company started selling battery packs through SolarCity Corp. (NASDAQ:SCTY), which is located a few miles from Fremont.
Doubling production capacity
According to analysts who visited the revamped Fremont plant, Tesla’s battery pack business is currently low-volume, but uptick in production is expected over the next 18 months. Even with the revamped factory, Tesla Motors Inc (NASDAQ:TSLA) is expected to increase its Model S production to about 1,000 a week by October, and that will almost double the production levels at the start of this year. The company is struggling to meet the demand for Model S, which continues to receive overwhelming orders in the U.S., Europe and China.
$5 billion Battery facility
In order to address its production constraints, Tesla Motors Inc (NASDAQ:TSLA) plans to construction a $5 billion gigafactory that will product about 500,000 battery cells annually. The Tesla has not yet decided the location of the gigafactory, but California, Nevada, Arizona, Texas and New Mexico are some of the potential locations for the facility.
Shares of Tesla Motors Inc (NASDAQ:TSLA) are up almost 62% in the past 12 months. Analysts at Global Equities Research are bullish on the stock, and they have an “overweight” rating on it with a target price of $385.