Next-Generation Construction Method Producing Cars in One Go
Plan Abandoned Due to Tesla's Cost Reduction Mode
American electric vehicle company Tesla has reportedly abandoned its plan to fully implement the next-generation manufacturing process known as gigacasting, according to major foreign media on the 1st (local time). This is interpreted as a change in Tesla's management strategy amid recent cost-cutting efforts.
According to sources, Tesla has decided to adopt a method of producing the vehicle chassis in three parts?the front, rear, and middle battery housing sections?separately and then joining them later, instead of the gigacasting process it has invested in and developed for years.
This means Tesla has withdrawn its plan to fully implement the gigacasting process, which uses large equipment to cast the chassis all at once. While the gigacasting process significantly reduces costs and manufacturing time compared to the traditional method of producing chassis parts separately and then joining them, it has the disadvantage of high initial investment costs.
Instead, Tesla will produce the front and rear of the vehicle as an integrated unit using the gigacasting method. It is known that the current Model Y and Cybertruck are also being produced using this method.
Tesla's recent decision is analyzed as part of a management strategy to cut short-term expenses amid sluggish sales performance and intensified price competition. Last month, Tesla reduced its global workforce by 10%. Resignations and dismissals of executives have also followed. Elon Musk, Tesla's CEO, recently reportedly laid off most of the Supercharger team, including Rebecca Tinuchi, who was in charge of Tesla's charging infrastructure, totaling about 500 employees.
Terry Boykovsky, president of American engineering firm CareSoft Global, said, "Everyone knows that integrated gigacasting is good," but added, "The question is how to handle the massive short-term capital investment." James Warmack, a vehicle manufacturing expert and former research director at MIT, evaluated, "This is the company's cost-cutting strategy to catch up with Chinese electric vehicle manufacturers dominating the low-price market," and added, "From the perspective of the public and buyers, gigacasting technology is not particularly interesting." He also noted that even if Tesla fully implements gigacasting, it is uncertain whether the expected large-scale production cost savings will be achievable.
Meanwhile, on the New York Stock Exchange that day, Tesla's stock closed at $179.99, down 1.80% from the previous session. It has fallen 27.56% so far this year.
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