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The sales slump is over - Tesla will expand in Germany.
The US electric car manufacturer Tesla is counting on a rapid expansion of production at its German plant in Grünheide near Berlin, thanks to rising demand and profits. According to the annual report of Tesla Manufacturing Brandenburg SE for 2025, the company expects for the financial year 2026 a clearly higher production volume compared with the previous year. The capacity utilization is expected to rise accordingly. More than 30 markets would be served from Grünheide, with additional ones to be developed. The plan is to maximize production. Tesla already announced this year the goal to ramp up its production in Grünheide to up to 7,500 vehicles per week - that would be 375,000 per year - and to expand battery cell manufacturing. A total of 3,500 new jobs are to be created. In the first phase after opening in 2022, Tesla had targeted 500,000 cars per year.
Tesla wants to bundle the entire value chain from the battery cell to the finished vehicle. This is "in this form unique in Europe". An expansion of the plant had previously been tied to the question of market development. Tesla also benefits from renewed government subsidies.
Expansion plans are also dependent on geopolitics
The company also sees risks. Further escalating geopolitical tensions, as well as disruptions to supply chains associated with them, could have a negative impact on the forecast, Tesla writes.
The full mapping of the battery value chain in Grünheide remains tied to economic conditions, because cell production in Europe faces significant challenges compared with the USA and China.
Higher annual net income - lower sales revenue
The Tesla subsidiary closed the 2025 financial year despite a market environment that had been challenging up to that point, with a higher net income of 77.1 million euros, which was an increase of around 20 million euros compared with 2024. The capacity utilization stood at 54 percent, slightly below the previous year's 56 percent. Currently, Model Y is produced there, which was Europe’s best-selling electric car in 2025. The sales revenue fell from 7.7 billion euros in 2024 to 7.1 billion euros in 2025. This is mainly due to lower production costs. In 2025, 202,000 vehicles rolled off the lines in Grünheide, down 9,000 vehicles from the year before. The development was mainly influenced by the model transition and the integration of new variants. Nevertheless, a stable production volume was achieved.
Tesla sees industry risk
The electric carmaker expects that competition in the automotive market will 'intensify even further'.
“Many of our competitors have substantially more resources or are better established than Tesla to design, develop, manufacture, distribute, promote, and sell their products,” the report says.
Moreover, Tesla is still in the early development stage and has limited resources and production capacity. Also, the share of electric vehicles in vehicle sales is low despite rising numbers. The company also sees the danger of further attacks. The report cites building credibility as a foundation for expanding the business. The products as well as statements and actions by Tesla management were the subject of numerous comments that could contain exaggerated or unfounded criticism — this could harm the business. The name of CEO Elon Musk is not mentioned here. Musk, however, has repeatedly faced criticism for his right-wing political views.
The Tesla plant in Grünheide employed around 11,000 people, including temporary workers, at the end of 2025, according to the report. The factory is Brandenburg's largest industrial operation. Environmentalists have concerns because it lies partly in a water protection area. A Tesla report found that the factory does not contaminate groundwater.
Content automatically translated.
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