Rumor: Tesla may use Magna to produce Model 3 in Europe

Tesla Model S

German media site Der Aktionär has reported (via InsideEVs) a rumor that Tesla is considering outsourcing European production of Model 3, possibly to Magna International, a global firm that provides parts to many OEMs, including Tesla, and in some cases even assembles complete vehicles under contract.

Peter Haidenek, Finance Chairman of Tesla supplier Polytec, told Der Aktionär [translated from the German], “Just a few days ago two colleagues were in Silicon Valley to visit Tesla. The top item on the agenda was Tesla’s possible engagement in Europe. Tesla said that it sees us as one of the preferred solution providers for possible production in Europe. The product range to be supplied by us could include battery packs, among other things.”

The quote does not mention Magna, and it’s unclear whether that company’s involvement is mere speculation, or whether Der Aktionär has another source that it did not identify.

In fact, the whole thing is the merest wisp of a rumor at this point, but it raises an intriguing possibility. Tesla is up against a huge bottleneck – it has half a million orders for Model 3 on the table, and it faces months or years of “production hell” before it can convert those to vehicle deliveries. To take a big chunk of those orders off the plate in Fremont, while also avoiding the expense of delivering vehicles to Europe, would be a grand coup.

On the other hand, Tesla has had bad experiences with third-party suppliers in the past, and currently seems more inclined to bring production in-house than the reverse. It seems unlikely that it would trust even a proven establishment like Magna with the production of its flagship vehicle.

 

Source: Der Aktionär via InsideEVs