Despite the global challenges caused by the pandemic, Tesla, Inc. has had a surprisingly profitable couple of years, reaching a market cap of $96 billion in March of 2020 and an astonishing $641 billion in March of 2021.
The company has been expanding its presence in North America, setting up its Gigafactory 5 in Texas in 2020, and now they have set up one of its huge manufacturing facilities in Markham, Ontario, which is set to inspire more healthy activity in the Canadian CRE market.
Tesla’s expansion to Canadian soil was first announced in the July 2021 edition of the Mayor’s Review. It’s the first Tesla manufacturing facility in the country, designed to produce battery manufacturing equipment.
According to the mayor, Frank Scarpitti, the location of the building is in an industrial area of Markham, west of Warden, and in close proximity to Tesla’s pre-existing warehouse and office space on 95 Clegg Rd.
Although the Mayor’s Review and Frank Scarpitti’s subsequent announcements on his Twitter and Instagram accounts does not share any details about the facility itself, he does confirms that the manufacturing facility will be up and running as of November 5th.
By all accounts, Tesla’s new facility in Markham, Ontario, is heavily related to the company’s quiet acquisition of Hibar Systems in 2019.
Hibar Systems Ltd was a Canadian manufacturer of precision metering pumps and dispensing systems. The company specializes in battery manufacturing and advanced automation systems engineering.
Simultaneously with the Hibar Systems acquisition, Tesla acquired six other companies specializing in high-speed battery manufacturing, including Maxwell Technologies.
Over the past few years, Tesla’s been hard-set on developing in-house battery cells and cutting ties with Panasonic. The move to in-house manufacturing would allow Tesla to offer cheaper electric vehicles (EVs) with better performance.
The Hibar Systems acquisition has allowed Tesla to start building its new 4680 battery cells. At the moment, the 4680 cells are manufactured in California, with expectations that Tesla’s new factories in Texas and Berlin will start doing the same. The facility in Markham, Ontario, is set to produce state-of-the-art manufacturing equipment for the 4680 battery cells.
According to Andrew Baglino, Tesla’s senior vice president, the first vehicles with these cells will start rolling out in 2022. Some of the EVs with 4680 battery cells should include the Model Y, Cybertruck, and Semi.
The opening of Tesla’s facility in Markham, Ontario, is excellent news for the Canadian CRE industry. Although Ontario already has a robust automotive industry, they welcomed Tesla with open arms. The rising demand for CRE space inspires healthy activity in Canadian markets.