Hey guys, it's sasha tesla opened the giga berlin factory two days ago, and there was one big problem: the stock market is completely misunderstood. What just happened? I am going to explain exactly what did happen and why. I think a lot of analysts are completely missing. The point it goes a lot deeper than just the obvious, so please listen up if you want all the insight, some of the best bits and more insightful bits come later on.

Tesla stock closed trading at around 921 dollars a monday the night before the big opening of the billion factory, and since that factory opened the stock went up ten percent. It is trading at about one thousand and ten dollars. As i'm recording this video, the fact remains. The average wall street analyst is just not as smart or sophisticated as you might think.

This event was extremely predictable, known in advance, and i mentioned that this will be a catalyst for tesla share price climbing multiple times before. But yet again the stock market was somehow still surprised, but it's not the opening of the gigafactory in berlin. That is the big deal. It is what the opening of that berlin factory means.

So let me break it down, for you just remember that i am a tesla shareholder, so some might say that my opinion is biased as a result, and also remember that i am not your financial advisor. I am just a random guy on youtube, sharing his opinion and analysis. I might be wrong and i do not own a crystal ball. What i do own other than a particular set of skills that make me a nightmare for people like you, is a light-year.

Investing account and lydia happened to be. The sponsors of today's video lightyear is the only free, investing app available in uk, where you can go and buy tesla shares completely 100 for free if you want to buy a share of tesla or two or any other u.s stocks that you like. For that matter, you can go and buy them on light year without having to pay any fees in the process, unlike trading to one two or free trade or any pretty much any other popular, investing app out there. There are no foreign exchange fees for up to 3 000 pounds per month, and no other fees either even better than free lighty will also give you a 10 bonus.

If you sign up using my link in the description and make a deposit of at least a pound, so if you want to try the platform out, you live in the uk, you can go and get paid by lightyear. Instead of paying fees to some other platform, not too shabby, okay, so on tuesday, tesla held an event in berlin to mark the official opening of the factory. The final approval paperwork turned up on friday and elon musk flew in to throw in some questionable dance moves. 30 customers were invited to take delivery of their model white cars and drove them literally out of the factory.

But here is what actually happened, because all of that was just for show. Giga. Berlin is currently set up with two giga presses, and apparently there are two more that are in the process of being installed. In fremont, two giga presses over there managed to make 58 000 roughly model y cars in q4 last year, so the capacity of one giga press looks to be at least 30 to 35 000 castings per quarter.

The model y cars being made in berlin have two castings per car, not one. They have two front and rear. So with two giga presses. The capacity there is for about 30 to 35 000 cars per quarter at the moment, which is about two and a half thousand cars per week with another two giga pressures coming online, apparently relatively soon.

That number will double now. The long term plan is to have eight giga presses within that phase. One of the completed berlin factory, which would give four times the 30 to 35 000 per quarter target. So roughly that 500 000 cars per year.

That tesla has announced that they are planning for berlin. Now, at the moment, the berlin factory is importing two 170 battery packs from tesla's shanghai factory. Reportedly they are getting up to 5 000 of them a week to enable production. These are the older, smaller cells that are currently being used across all of tesla's cars, probably the ones being manufactured by lg, going into the cars in berlin being made right now - and this is because the production of 4680 cells, which are the new, bigger, more efficient, Cheaper sales is still in the process of ramping in the us.

Gigatexas will start their model y production with structural 4680 packs right out of the gate, the ones being made over in california coming into the texas plant to be used. But at the moment tesla is not making enough of those battery packs. They haven't started production of those packs in berlin. They haven't started production of those in texas.

As far as i'm aware, so at some point the plan is to switch from using two 170 cells to four 680 cells in the berlin factory later this year. I am guessing this will happen at some point in q4, but the rumor mill is also saying that berlin is going to start by only making 500 cars per week. So the limiting factor here is not to the batteries and it is not. The giga presses the most likely limiting factor at the moment.

Is people experience and polishing out the various parts of the process. Tesla has so far hired just three and a half thousand people into giga berlin and the phase one of the factory, which is the current building, apparently needs 12 000 people to operate at full capacity. So they only have about a quarter of the people, they need to run at full speed and remember that scaling a huge factory is not linearly dependent on the number of people working there. You have a base requirement for employees, regardless of how fast your production runs and how many roles it is that you have on the actual production line.

Many roles also do not scale linearly with production, so a doubling in the number of people in this case should produce a more than doubling effect on the production capacity. Now i went on the tesla jobs website and there are currently 330 age jobs listed in giga berlin, which is in grundheider, brandenburg. Yes, i did actually go and count them, and presumably many of these job descriptions are not only looking for one person to fill them. So you can see that they are pretty busy hiring and training people and probably will be for a little while this means that, in my opinion, the rapper billion is likely to be somewhat slower initially, but then ramp up quite fast later this year.

Apparently, the target is to hit 1 000 cars per week by the end of april, and that is quite low by tesla standards, but it is an incredible achievement just weeks after opening factory for the first time, it is already way way way ahead of what the Likes of riven or the likes of lucid have produced in months since they started their production, so the berlin factory is not going to have much of an impact on production numbers for tesla in q1 and q2. One week in q1 will probably only mean around 500 cars coming from the billing plant for the q1 total and, if they're, only going to ramp up to about a thousand per week by the end of april, we're probably looking at something like 15 000 cars. Coming from the berlin plant in q2, or about four to five percent of tesla's total production right now. However, all the noises at the moment are pointing to the ramp being much quicker than previously expected towards the end of the year.

So i'm now, estimating q4 might hit around 30 000 cars. Now it would be higher, maybe as high as 40 to 50 000 cars, but remember that they have to stop production for about three to four weeks to switch from using to 170 cells to 4680 cells in that quarter in the berlin factory. And that's why my total, for that quarter at the moment, is a bit lower. The permit that was just issued to berlin also allows them to manufacture up to 50 gigawatt hours of battery packs on the same site, and if you assume that the average battery pack coming out of giga berlin will maybe be around, i don't know 80 kilowatt hours.

That means that they will be able to make around 625 000 cars in berlin, using four 680 cells manufactured on the same site. The plan for gigabiling does include space for three more phases, although, after the german authorities took six months longer than expected to issue the permits for the first one, tesla have officially gone and got pissed off and put those plans on ice. I do feel that time is a great healer and once billion is firing on all cylinders this year they don't have cylinders, but you know what i mean. I think enough.

Water will pass under the bridge and we'll see the second phase being built on the site. Seeing as they've already got all the infrastructure in place and all the employees and everything else now gigabilin will serve the european car market, but the european car market is even bigger than the sum of u.s and canada, and it's really important to remember that. The wait times here in the uk and many other european countries are even more crazy than they are in the united states. The demand is absolutely through the roof.

Giga shanghai took two years to ramp to a run rate of 750 000 cars a year and they are now expanding that capacity as well. Given that the shanghai factory was the first factory that tesla built because remember, fremont was an existing factory that tesla acquired. I am expecting berlin to ramp faster, although, as always, it is unknown how much of an impact the german bureaucracy is going to have. So i would be surprised if we're not seeing an annual run rate of somewhere around that 500 000 cars a year mark or more around q3 next year.

But the incredible thing is that berlin is just the start. It's not even the very important thing because on the 7th of april, just in a few days, tesla is hosting a big opening event for giga texas in austin and giga. Texas is a much much bigger deal. It's not only the new hq for tesla.

This is also tesla's biggest factory. Berlin is currently the smallest factory. The current blueprint, the current phase, one building out of all four that they have texas will start manufacturing cars with four 680 cells straight from the get-go and gigatexas has an absolutely enormous plot. It is way way bigger than the german plot or any of the other ones it is bigger than all of them put together.

You saw what happened when giga berlin opened and started delivering cars so i'll, be watching very closely to what the analysts think of texas reminder if you want to invest in tesla or any other stocks before or after giga texas opens. My link for light here is in the description on the pinned comment now, three weeks after texas opens we'll have q1 results i'll be covering those results live on my channel. So if you want all the insight as soon as the data is published, please come along q1 production and sales are looking incredibly strong, so it looks like we set for another record quarter now. Production numbers in q4 were absolutely off the charts and i am not sure if shanghai is going to be matched the numbers in q1, but remember that this quarter, tesla have been shipping a lot more model s and model x, flat cars and those carry much much Higher margins so expect much better numbers on the revenue and gross margin fronts because of that and tesla also have increased prices twice in march alone, and they were increasing them in the run-up as well.

The price of most cars is up over 20 in the last year, so gross margins should look pretty good from q2 onwards, we're going to see berlin and austin contributing and even in the early stages of them ramping. If we're just seeing 15 000 cars made in q2 in each of those factories, that's already going to be a 10 increase on the q4 total for tesla. But then, a few days ago, elon musk announced that he is working on his master plan. Part three.

This is something that elon does every few years where he outlines the concept for what he wants to achieve with his businesses. It started out with just tesla, but now he's talking about more than that. His initial plan for tesla was to prove the concept. The second part of his master plan was to scale production, and here is where it gets seriously interesting for anyone who's a tesla shareholder, because elon musk replied to dr jack on twitter.

Recently saying main tesla subjects will be scaling to extreme size, which is needed to shift humanity away from fossil fuels and ai. Then literally, the next day after tweeting that elon musk said at the opening of the billion factory that he is planning for tesla to grow. At above 80 and perhaps even pushing for doubling year on year, so that is pretty incredible. It really begins to piece things together, because then you go and think - and you remember that tesla have recently announced that they are planning to significantly expand their capacity in fremont.

Oh and tesla shanghai is currently in the process of being expanded. They are due to finish at the end of april bringing the maximum capacity of that factory to something like 1 to 1.2 million cars per year. Oh and and also there has been a huge amount of noise about tesla, building that second shanghai factory next to the current one, tesla haven't yet confirmed or denied those rumors. Maybe they're waiting for the q1 results to announce it so that then the shanghai news doesn't dampen or somehow cast a shadow on the giga, berlin and giga texas openings and then remember that also in november.

I think it was that elon said at the shareholder meeting. The tesla will be announcing multiple new factory sites later this year. So if you feel that tesla stock is overvalued today at one billion dollars, remember that the valuation is a pe of 113 based on the run rate from q4 and a multiple of 64 on the annualized version of the ebitda. Before we even talk about things like fsd energy or any other parts of future tesla business, what do you think is going to happen when tesla's production is running at four times what it was last year in perhaps less than three years time with higher margins? Because of more local factories, four 680 cells and economies of scale, on top with the berlin factory opening that was just the first stepping stone in elon musk's new plan that is literally planning to scale to extreme size.

Here's where it's not mine, if you want to see a complete breakdown of my valuation model, the latest one for tesla, that has a 3 300 price target. I go through every detail in this video right here, so please go and check it out. If you want to find out, if you found this video useful, please don't forget to smash the like button for the youtube algorithm. Thank you so much for watching.

I really really appreciate it and, as always i'll see you guys later, you.