European EV production is expected to double from 0.8 million units in 2020 to 1.7 million by 2023, which is then expected to reach five million by 2034. European production will be second to China, which is predicted to manufacture around 1.2 million in 2020, rising to 3.9 million by 2023 before more than doubling to 8.2 million.

David Leggett, Automotive Editor at GlobalData, added: "A production hub situated at the heart of Germany, and close to its customer base, will help Tesla to build manufacturing and cost efficiencies. Ultimately, a car company with global market ambitions has to have its manufacturing footprint spread around the world. With manufacturing facilities in North America, China and Europe to serve those major regional markets, Tesla can build a more balanced manufacturing network and improve its logistics and distribution processes - something that has not always been smooth due to over-reliance on its Fremont, California, production base.”

Tesla is also establishing an engineering and design centre in Berlin to tap Germany's rich engineering resources and talent pool.

Leggett concluded: "Germany was always a front-runner for Tesla's first European plant because of its position at the heart of Europe's automotive industry and market, its established premium brands and indications from the German Government that it will be very supportive in encouraging e-mobility.