Tesla Doubles Down on Giga Berlin Output Amid Struggles in Europe

Electric vehicle (EV) giant Tesla’s TSLA Giga Berlin plant in Grünheide is gearing up for a production boost through the remainder of 2025 amid growing demand for the Model Y.The Grünheide factory, which first opened in March 2022, serves not just Europe but also Canada, New Zealand, Australia and parts of the Middle East. Earlier this year, the plant rolled out its 500,000th Model Y. Last month, it celebrated another milestone with the production of its 100,000th refreshed Model Y. These underscore how quickly Giga Berlin has scaled since its opening three years ago.Production Goals Raised Amid Mixed Sales TrendsAccording to André Thierig, manager of the Berlin facility, the company has revised its production targets upward for the third and fourth quarters, citing “very good sales figures.” He told DPA (the European news agency), as reported by Reuters, that positive demand signals are coming from more than 30 markets that Giga Berlin supplies.The timing of this optimism is noteworthy as Tesla has been grappling with declining registrations across several European markets this year. Tesla’s European sales slipped for the eighth consecutive month in August 2025, with sharp year-over-year drops in various key markets.Per Reuters, registrations fell 47% year over year in France last month, over 80% in Sweden, and around 50% in the Netherlands. Germany is also showing signs of weakness. These declines come amid intensifying competition from Chinese automakers, Tesla’s relatively narrow product lineup and public backlash against CEO Elon Musk.Yet there are a few bright spots. Tesla’s sales in Norway were up 21% last month. Portugal posted nearly 29% growth after months of decline, while Spain recorded a massive 161% jump in sales, aided by government subsidies of up to €7,000. These mixed results suggest that while Tesla’s growth story in Europe has become more complex, opportunities remain in select markets.Why Giga Berlin MattersThe Berlin factory is no longer just a European production hub. It will also help the company to sidestep tariffs on U.S.-built EVs. Tesla has started routing some vehicles from Germany to Canada, per Drive Tesla. This shift allows the company to cut costs tied to cross-border trade.Another layer to Berlin’s importance is product exclusivity. At the moment, it is the only Tesla site building the upgraded Model Y Performance. This variant is not just limited to Europe; it’s also heading to the Middle East, and more recently to Australia and New Zealand. As a result, Berlin’s output has become central not just for European customers, but for key international markets as well.The planned ramp-up at Giga Berlin reflects Tesla’s commitment to growth, despite rising competition and challenges in select markets.The Zacks Rundown on TSLAShares of Tesla have rallied more than 30% over the past three months, outperforming the industry as well as legacy auto giants like Ford F and General Motors GM. Ford and General Motors shares rose over 11% and 21%, respectively, over the same timeframe.  3-Month Price Performance Comparison Image Source: Zacks Investment ResearchFrom a valuation standpoint, TSLA trades at a forward price-to-sales ratio of 12.98, way above the industry. It carries a Value Score of D. Meanwhile, General Motors trades at a forward sales multiple of 0.32 and Ford at 0.28. Image Source: Zacks Investment ResearchSee how the Zacks Consensus Estimate for TSLA’s earnings has been revised over the past 60 days. Image Source: Zacks Investment ResearchTesla stock currently carries a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Radical New Technology Could Hand Investors Huge GainsQuantum Computing is the next technological revolution, and it could be even more advanced than AI.While some believed the technology was years away, it is already present and moving fast. Large hyperscalers, such as Microsoft, Google, Amazon, Oracle, and even Meta and Tesla, are scrambling to integrate quantum computing into their infrastructure.Senior Stock Strategist Kevin Cook reveals 7 carefully selected stocks poised to dominate the quantum computing landscape in his report, Beyond AI: The Quantum Leap in Computing Power.Kevin was among the early experts who recognized NVIDIA's enormous potential back in 2016. 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