what if I told you that one of Tesla's
most important acquisitions was being
completed mostly behind the scenes in
the dark
welcome to Electrify on January 3rd 2017
Tesla completed their acquisition of
Grohmann engineering now Tesla Grohmann
automation a 700 employee German company
that specializes in the design
development in sale of automated
manufacturing systems for one hundred
nine point five million dollars in cash
Tesla acquired Roman to improve the
speed and efficiency of their
manufacturing processes we've realized
that the true problem the true
difficulty and where the greatest
potential is is building the machine
that makes the machine
in other words building the factory and
really thinking of a factory like a
product at the time of acquisition Tesla
entered into an incentive compensation
arrangement for up to a maximum of
twenty five point eight million dollars
of payments contingent upon continued
service for thirty six months after the
acquisition date however at the end of
quarter one 2017 taso terminated the
incentive compensation arrangement and
accelerated all payments as a result
Tesla recorded the entire twenty five
point eight million dollars as
compensation expense during quarter one
2017 which was included in their SG&A
expenses Tesla was actually a client of
Grohmann engineering before they decided
to buy the company shortly after the
acquisition Klaus Grohmann founder of
Grohmann engineering was ousted from the
company after a disagreement with Elon
Musk Grohmann reportedly disagreed with
elan over how to handle his firm's
legacy clients which included Tesla
competitors like Daimler and BMW Elon
wanted the German manufacturing facility
to focus solely on building machines for
Tesla vehicles which meant dropping all
other clients Klaus Grohmann was quoted
as saying I definitely did not depart
because I had lost interest in working
he chose not to elaborate any further a
Tesla spokesman when asked about
Grauman's departure praised him for
building an incredible company and said
part of mr. Grauman's decision to work
with Tesla was to prepare for his
retirement and to leave the company and
capable hands for the future given the
change in focus to Tesla projects we
mutually decided that it was the right
time for the
next generation of management Tilly even
after the departure of Klaus the
employees wanted to unionize as they
were concerned about their job security
moving forward with only one client
Tesla in response he LAN wrote a letter
to the employees which I'll link in the
description below here are a few
highlights from the letter quote Tesla
is unlike most other companies unlike
others the existence of Tesla is not
only to make money if it were only about
this one goal then I can tell you that
the founding of the completely new car
manufacturer would definitely not have
been the smartest way the foundation of
everything we do is to accelerate the
advent of sustainable energy the welfare
of our planet is in great danger and in
order to solve this problem we need
sustainable solar energy production a
sustainable way to store the energy and
stationary batteries and we need a
sustainable way to consume this energy
with electric vehicles it's critical for
the future of humanity to solve this
problem we all want a better world for
future generations although it's not
what drives us Tesla has real potential
to be one of the most valuable companies
in the world
we bought Tesla Grohmann because we
believe that Tesla Grohmann will play an
important role in creating this future
it's not enough to produce cool products
to be successful we need factories that
are as good as the products themselves
end quote
Elon then went over compensation details
for the employees ensuring job security
and future growth prospects each
employee was to receive around $11,000
worth of Tesla shares and an immediate
cash bonus of $1,100
Elon also mentioned upgrades to the
working facility and parity between
supervisors and employees highlighting
how the supervisors are there to serve
the employees and not the other way
around
at the end of 2018 it was reported that
the Grohmann machines are not only
intended to improve efficiencies for
vehicle production but they'll also
enable battery production at three times
the current rate and for one third of
the cost of today's modules that would
mean going from 6000 battery packs per
week to 8,000 at a fraction of the cost
this is yet another in a long list of
impressive competitive advantages for
Tesla what's what's what's happening is
what I have predicted for the last three
years is finally coming to
past everybody in the global automobile
industry is going to be offered covering
high quality high technology high range
electric vehicles and the Tesla has no
advantage no technological advantage no
software advantage no battery of men no
advantages whatsoever how are you
feeling today Bob what up toward the end
of 2018 Elon tweeted 2170 is about the
right cell size but I don't recommend
copying our current module design far
too difficult to manufacture if you're
unaware tesla uses 2170 lithium-ion
cells in the model 3 compared with the
18 650 cells used in the Model S and X
which stretches the length of the cell
from 65 millimetres to 70 and increases
the diameter of the cell from 18
millimeters to 21 this is yet another
indication that there may be some major
changes happening at battery Investor
Day which should be taking place in the
next few months there hasn't been much
reporting as of late when it comes to
Tesla Grohmann Automation the website
has little information but there are job
postings listed it's obvious that major
manufacturing changes take time to
implement and these new machines
building machines won't garner a ton of
press but they're ridiculously important
to the pace of innovation and production
for Tesla machines have already been
shipped to gigafactory 1 at the end of
2018 and others are most likely to be
used at g3 and will certainly be
implemented at g4 in Germany when it
comes online while this acquisition
Garner's minimal press it is quite
possibly one of the most important and
impactful acquisitions for the long-term
growth of Tesla as Elon mentioned you're
now more informed on this matter than
95% of the so-called industry analysts
thanks for watching I hope I've earned a
like a comment and a subscription if not
please tell me what I can do to improve
for future videos I'll see you next time
it's like wow this is this crazy
potential for improvement here
I think at least an order-of-magnitude
potential for improvement on production
and so with with with less like
significantly less engineering effort I
we can make dramatic improvements to the
machine that makes the machine
