An investor says the cost of the German factory is a total loss, as soon nobody in EU will be buying a Tesla and inventory stacks up.
Despite having spent close to $5 billion building a factory in Brandenburg, Germany, which started production in March 2022, Tesla’s sales in Europe are beginning to drop towards levels before the factory existed (see Figure 5).
Tesla’s German factory operated at 18% of capacity between March to December 2022, 47% last year, and at 45% in the 1H of 2024. Capacity utilization under 70% usually implies losses. Below are what I see as growing problems for Tesla in Europe that could lead them to write off their German plant (if Musk were smart, and we know he isn’t).
Of course this misses the point. Elon Musk taking over Twitter was backed by Russia, to be a disinformation spigot inside America. Sure it’s a bad business decision, but that’s not how military decisions are made.
Likewise, Russia financing a giant munitions factory to generate chemical cluster bomb drones just outside of Berlin… is a military plan with little relevance to car business as usual.
Consider that this Tesla factory is in the old “East” that was Putin’s notorious stomping grounds for KGB operations to spin up Nazi gangs that could infiltrate the West. This time around, instead of hooligans, expect Putin’s plan to leverage idle Tesla robots to cause mass terror and destroy democracy.
Tesla building a Russian munitions factory inside Germany, and filling it with Nazi party (AfD) activists to influence elections, has very little to do with selling cars.
Background:
Let’s start with this. A disused military facility outside Berlin is stockpiling “unsold” Tesla cars on a military base.
Is it reasonable to accept the CEO’s portrayal of this as a collection of AI-powered robots that can be controlled by one person with a simple command? Perhaps national security experts should evaluate this centrally managed drone force – which essentially amounts to a mobile arsenal of clustered chemical explosives – for what it truly represents.
The Tesla factory in Brandenburg is located near the borders of Saxony and Berlin, but not Thuringia. Brandenburg, Saxony, and Thuringia are all former East German states that have experienced significant Russian influence. The extremist far-right Alternative for Germany (AfD) party, often criticized for being a Nazi party that Elon Musk actively promotes, has gained considerable support in these states. In Thuringia, the AfD won the most recent state election with 32.8% of the vote, marking the first time a far-right party has won a state election in post-war Germany. In Saxony, the AfD narrowly lost the state election, receiving 30.6% of the vote. Brandenburg has also seen a rise in AfD support, influenced by the party’s growth in neighboring states. German political parties refuse to form coalitions with the AfD, viewing it as a threat to democratic principles. Some observers argue that the AfD’s rise is part of a broader strategy, possibly driven by Russia (along with Elon Musk), to fragment German politics and hinder the formation of stable governments.
Notably, Putin served in the KGB from 1975 to 1991. He started as a junior officer in the Second Chief Directorate (counter-intelligence). He primarily was stationed in Leningrad (now St. Petersburg) but from 1985 to 1990 was assigned to Dresden, East Germany (German Democratic Republic). Putin had achieved the rank of Lieutenant Colonel by the time the USSR was being dismantled in 1991. Examinations of Stasi files and interviews with former colleagues (e.g. Klaus Zuchold) suggest Putin’s role was far from mundane — even though it was meant to appear boring or unimportant middle management operations work and low-level intelligence gathering.
There are networks of billionaires who essentially are arms of the Kremlin
Specifically, it is far too easy to describe as mundane how the Dresden KGB efforts drove the city and surrounding region of Saxony to be strongholds of Nazi activity in Germany up to the present day. The most striking example is a Nazi leader in Germany who had previously been an informant for East German intelligence (Stasi) and had connections to the KGB, including Putin. Rainer Sonntag initially was recruited as an informant by Georg Johannes Schneider, who worked directly with Putin in Dresden in the late 1980s. According to researcher Regine Igel, Sonntag became involved with prominent neo-Nazi Michael Kühnen and rose in the far-right movement after being ransomed to West Germany in 1986.
Putin attempted later to describe his Dresden time as sitting around doing nothing at all, just drinking beer with Germans and putting on weight like them, which should obviously warn you he was instead a very busy, athletic, cruel and dishonest officer stationed in Dresden to run targeted extremist operations into Berlin.
he liked to pretend when he first came to the presidency that he hadn’t done anything at all, and the very fact of his being there was a sign that his career had reached a dead end. He talked about how there was nothing to do, and all he did was drink so much beer that he put on weight. When, really, there are no photographs there showing Putin having put on any weight at all. I think people were overly dismissive of Dresden and its importance. Putin was working closely with Matthias Warnig, who we know now as the chairman of Nord Stream 1 and 2. In those days, Warnig was a hotshot Stasi officer. According to a defector who had worked with Putin in the Stasi, Warnig was running a KGB cell for Putin. Putin was the chief liaison between the KGB and the Stasi, and it also turns out from another defector that Putin was then involved in active measures against the West. For instance, he had been trying to entrap a professor into handing over the secret to untraceable poison by planting compromising pornographic materials on him. We don’t know whether this operation ever came off. Putin was supposedly also a handler of a notorious neo-Nazi, who later helped stoke the rise of the far right in the east. […] Putin being in Dresden did not mean his career was at a dead end. It meant that he was actually involved in much more covert operations that were far away from the eyes of the West, and the West was concentrating only on Berlin.
Elon Musk, heavily concentrating on Berlin, has become infamous for boasting about warm relations with Putin such as when he can and does call the dictator on the phone to discuss Ukraine strategies. Musk also recently has been implicated in Russian propaganda campaigns targeting America.
On a related note, as picked up by German reporters, Putin used Tucker Carlson to promote the grotesquely false disinformation narrative that Hitler was right to invade Poland just as Putin is right to invade Ukraine.
And Elon Musk similarly just used Tucker Carlson to promote the grotesquely false disinformation narrative that Hitler was the good guy in WWII and the Holocaust.
And this is why a huge old military base outside Berlin filled with Tesla robots has little to nothing to do with typical business analysis, confusing street investors who overlook the geopolitical security implications.