Tesla under the gun to create jobs at Gigafactory 2 in Buffalo, NY as countdown begins

Tesla’s Gigafactory 2 in Buffalo, NY was dubbed fully complete by state and company officials this past April, starting a countdown clock for Tesla to provide 1,460 jobs to Buffalo, NY within the next two years. Failure to do so could result in fines of up to $41.2 million for every year that it does not meet this employment goal.

When Tesla received support from the state worth $750 million to build and equip the solar factory, the company committed to providing 5,000 jobs to the state of New York within the next ten years. These job-creation targets have evolved over the years, particularly when SolarCity was acquired by Tesla. The state of New York’s original agreement with SolarCity required the company to provide 1,460 jobs at the solar factory and another 1,440 jobs at suppliers and service providers in the Buffalo region. This gave SolarCity a target of providing 2,900 jobs for local workers.

Once Tesla took over, the requirement to bring in 1,440 suppliers was waived by the state. The revised agreement with New York included requirements for Tesla to create 1,460 jobs in Buffalo within two years after the factory is complete, including 500 manufacturing jobs at Gigafactory 2. In a statement to The Buffalo News, Tesla officials stated that the company had already surpassed the first employment target — one that required Tesla to create 500 jobs by April 2019. By meeting this target, Tesla is now tasked to more than double the number of jobs it created so far, in order to meet the state’s April 2020 deadline.

Tesla’s Gigafactory 2 might seem almost dormant amidst the company’s push to ramp the production of the Model 3, but the electric car and energy company maintains that it intends to produce its solar products at a larger scale in the Buffalo facility within the coming quarters. Before its Q2 2018 earnings call, CTO JB Straubel stated that Tesla is “aggressively ramping” the production of its residential solar products, which are manufactured at the New York factory. Straubel also stated that production of the Solar Roofs are expected to accelerate in 2019, as residential installations of the shingles are rolled out to reservation holders.

The Tesla executive reiterated this statement in the company’s second-quarter earnings call, stating that while the company’s electric car business is bigger today, the growth of Tesla Energy is faster. Elon Musk even noted that Tesla Energy would likely catch up to the electric car business’ size in the future.

“Yeah, if you extrapolate energy growth rate, well, obviously, if you extrapolate anything when that triples for a year pretty soon becomes the size of the universe, but long-term we would expect the energy business to catch up to the auto business in size,” Musk said.

Tesla’s Gigafactory 2 in Buffalo, NY is tasked with the production of the company’s Solar Roof tiles, which, together with the Powerwall 2 home battery, are part of the company’s initiative to help customers achieve “sustainable energy independence.” At full capacity, Tesla’s Gigafactory 2 is expected to manufacture 1 GW worth of solar products every year. In classic Elon Musk fashion, the CEO gave a more optimistic forecast for the facility back in 2016, stating that he estimates the factory to be capable of producing as much as 10 GW worth of solar products annually.