According to leaked audio from a Tesla internal meeting, Chris Lister, VP of Gigafactory Operations, has left the company. Hrushikesh “Hrushi” Sagar was promoted to Gigafactory Manager. In an address to employees heard by CNBC on Thursday, Sagar and other leaders discussed production rates in the company’s car factories as well as its battery products, the Powerwall and Megapack. They also discussed improvements, such as a new wastewater treatment plant and increased power from the solar roof.
Tesla has restructured leadership at the Gigafactory, its sprawling battery plant outside of Reno, Nevada, and has set new objectives for the facility. According to audio from a Thursday meeting and documents shared with CNBC by people who work at the factory, former Vice President of Gigafactory Operations Chris Lister left Elon Musk’s electric vehicle and clean energy businesses this summer, and Hrushikesh “Hrushi” Sagar was promoted to oversee the Gigafactory. Sagar will report directly to CEO Elon Musk while also overseeing Tesla’s vehicle assembly plant in Fremont, California. On Thursday afternoon, Sagar spoke to a group of hundreds of Gigafactory employees about management changes, performance reviews, factory milestones, and aggressive new facility goals. He also revealed some details about Tesla’s factories in Austin, Texas, and outside of Berlin, Germany.
“I really appreciate what Chris Lister did here, Chris’s contribution,” Sagar said briefly of Lister’s departure. I’m grateful, as are Elon and Tesla, for his contributions, but we’re moving on to the next phase.” Workers at the Gigafactory make battery packs and power trains for Tesla’s electric vehicles, as well as large backup batteries sold by Tesla’s Energy division, the Powerwall, and Megapack. During the meeting, Sagar noted that Tesla produced approximately 134,000 vehicles in its Fremont, California, factory in the second quarter of 2022 and that August was one of Fremont’s most productive months. According to him, the Fremont factory can now produce around 12,000 cars per week and is aiming for 14,000 per week as its next goal. He also stated that Tesla’s team in Brandenburg, Germany, recently achieved the capability of producing 1,000 cars on a rolling seven-day basis. Musk recently visited the German factory, which is expected to ramp up production to 5,000 vehicles per week by the end of 2022. Reno initially sent drive units to Germany to assist in that effort.
Tesla’s new factory in Austin, Texas, has also reached 1,000 units per week. In terms of drive unit production, the Gigafactory “fed” the company’s Fremont and Austin factories in the second quarter of 2022, producing 283,473 power trains. “You all played a significant role,” Sagar said. “I just want to thank you from the bottom of my heart,” the Reno team said.
New leaders and goals for the Gigafactory
Chris Lister spent 22 years at PepsiCo in precision manufacturing roles before joining Tesla in late 2017. During his time at Tesla, the Gigafactory experienced rapid expansion and growing pains, including large amounts of scrap, fires, and oil spills. However, by increasing production there, he helped propel Tesla to the top-selling battery electric vehicle brand in the United States and around the world. Requests for comment from Lister and Tesla were not immediately returned.
According to his LinkedIn profile, Sagar’s new title is senior director of vehicle operations and manufacturing engineering. On Thursday, Sagar told employees that they should think of the Fremont factory as a “customer,” noting that vehicle production there succeeds or fails based on Gigafactory shipping volumes and quality.
While Sagar does not intend to spend the majority of his time in Reno, he will collaborate closely with plant leaders such as Energy Leader Matt Reddick, who joined the company about six months ago, and Site Leader Eric Montgomery, who will manage day-to-day operations in Nevada. Other top leaders at the Gigafactory now include Jeff Jackson, who oversees the facility’s infrastructure, and Bert Somsin, the plant’s human resources director.
Montgomery told Gigafactory employees at the same meeting on Thursday that they needed to reach a steady output of 8,800 high voltage battery packs per week to support Fremont’s new production goals and “maximize all-wheel-drive builds.” He also stated that August 2022 was the Gigafactory’s second-best month for production, trailing only October 2021. According to Reddick, Tesla can now produce 42 massive Megapack batteries in a seven-day rolling period. Megapacks are roughly the size of a shipping container and are used for utility-scale energy storage, frequently to store excess wind or solar energy.
Tesla expects to produce 442 Megapacks in the third quarter of 2022, an increase of 85% over Megapack production in the previous three-month period. The Gigafactory has also reached and exceeded a weekly production rate of 6,500 Powerwalls. CEO Elon Musk recently promoted Powerwalls, the smaller backup batteries for home use that Musk recently promoted on Twitter in the midst of California’s massive heatwave. The state urged residents to reduce their power consumption during peak hours as a result of the heat wave.
Previously, Tesla required customers who wanted to purchase a Powerwall to also purchase a solar roof from the company. Montgomery stated that the Nevada Gigafactory produced 37,600 Powerwalls in the second quarter and that the facility is on track to produce 22% more in the third quarter. Regarding the facility itself, Jackson highlighted a new, advanced water treatment facility that Tesla is constructing on-site.
“This will eliminate the discharge of our site’s process water, or wastewater, and allow for 98% water recycling and evaporation,” he explained. “It’s a huge deal, and it’s in line with our mission.” Jackson also provided an update on the solar roof at the Gigafactory. “Right now, we have about eight megawatts on the roof that we can use on a daily basis, which is really exciting,” said the infrastructure leader.
Tesla also has a new food vendor on site that serves poke bowls, is constructing a meditation room for employees, and is improving roads and installing more EV chargers around the facility. Workers were encouraged to reduce the number of labor hours required to produce a single unit of the products they build in their teams, as well as to file more “take charge” notices about how to improve safety and reduce costs around the plant.
According to Sagar, the company is moving past the steep headcount cuts that occurred in the second quarter of this year and is in the midst of an extensive performance review process. When asked if their equity grants would be tied to company milestones this year, management said no. However, human resources teams and managers are still determining who is eligible for promotions, raises, and bonuses. Managers, according to Sagar, should be discussing performance evaluations with their teams by the end of September.
Employees requested that management discuss whether and where Tesla’s next factory should be built. Tesla’s lobbying activity in Canada, as well as the company’s previous investments in the country, have previously fueled speculation of a Canadian-based plant. “I have some ideas on the candidates,” Sagar said, “but I don’t think I’m at liberty right now to disclose those candidates due to the confidentiality surrounding some of those things.” “There is an exciting future for North America and all of the Americas,” he said.
