The Closed Toyota Factory That Gave Tesla Room to Grow

By Human Business Works

At 9:21 on the morning of April 1, 2010, the last Toyota Corolla rolled off the production line in Fremont, California.

Workers gathered to watch it leave.

For 25 years, the huge factory had been home to New United Motor Manufacturing, better known as NUMMI. It was a joint venture between Toyota and General Motors, and nearly eight million vehicles had been made there.

Now the line was stopping.

Toyota's photographs from that morning show workers standing around the final Corolla. Other images show employees embracing after their work was finished. Some stayed behind even after production ended, cleaning paint guns and replacing tips on welding machines.

Outside the plant, the mood was harder.

More than 4,500 people were losing their jobs. Some former workers went directly to file for unemployment. Others gathered for prayer or met nearby to say goodbye to people they had worked beside for years.

A factory that had spent decades making cars had suddenly become quiet.

Only weeks later, another car company was looking at that same space very differently.

Tesla Motors was still small.

Its Roadster had shown that an electric car could be fast and desirable, but Tesla wanted to build something much more ambitious next: the Model S, an electric sedan intended for a much larger group of customers.

Making a few thousand sports cars was one kind of work.

Building cars in serious numbers required something else.

Tesla needed a factory.

The closed NUMMI plant had plenty of room.

The Fremont site covered hundreds of acres and contained millions of square feet of manufacturing space. It already had the kind of infrastructure needed to build cars: assembly areas, equipment, loading space and decades of automotive history.

For Toyota and GM, that history had reached an ending.

For Tesla, it looked like a beginning.

In May 2010, Tesla reached an agreement to buy the Fremont factory. The price for the land and manufacturing facilities was about $42 million. Tesla later completed the purchase in October.

The timing was unusual.

The old factory had barely closed before another company was preparing to move in.

There was another surprise too.

Toyota was not simply walking away from Tesla's story.

In the same month that Tesla announced plans for the factory, Toyota agreed to invest $50 million in Tesla. The companies also said they would work together on electric vehicles, parts and production knowledge.

Toyota had spent decades learning how to make cars efficiently in large numbers.

Tesla had something Toyota wanted to understand better: electric vehicle technology and the speed of a much younger company.

The relationship soon became practical.

Tesla and Toyota began developing an electric version of the Toyota RAV4. Tesla would provide an electric powertrain, including technology around the battery, motor and related systems, while Toyota brought its own experience in vehicle manufacturing.

Back in Fremont, the empty factory was being prepared for a new kind of work.

Tesla also bought more than $17 million of manufacturing equipment and spare parts from NUMMI and Toyota, saying it had acquired them at large discounts compared with buying new equipment.

For a young car company, that mattered.

Factories are expensive before a single finished car leaves the building. Machinery has to be installed. Workers have to be hired and trained. Suppliers have to deliver parts at the right time. Production lines have to turn drawings and prototypes into the same finished product again and again.

Tesla was trying to move from being known for the low-volume Roadster to making the Model S in much greater numbers.

The Fremont plant gave it space to attempt that change.

On October 27, 2010, Tesla officially opened what it now called the Tesla Factory.

Only months earlier, NUMMI workers had stood beside the final Corolla.

Now Tesla employees, executives and visitors were looking at the same industrial site as the future home of the Model S.

Tesla said at the time that it had delivered more than 1,300 Roadsters around the world. That was a meaningful achievement for a young electric-car company, but it was tiny compared with what the old Fremont plant had been built to handle. NUMMI had once produced more than 400,000 vehicles in a year.

The size of the factory showed the size of Tesla's next challenge.

Having space did not mean Tesla was suddenly ready to fill it.

The company still had to finish developing the Model S, prepare the production system, hire people and learn how to build the car consistently.

For nearly two years, the future of the factory remained something workers were preparing for rather than something customers could drive.

Then, on June 22, 2012, the first Model S customers came to the Fremont factory to receive their cars.

Tesla had moved from prototypes and preparation to deliveries.

By the end of that year, the company said it had produced more than 3,100 Model S vehicles and delivered about 2,650 of them. Production was still young and costly, but cars were once again leaving the Fremont plant for customers.

The factory had not come back in the same form.

The old NUMMI operation had been built around a partnership between two of the world's established carmakers. Tesla entered the building as a much smaller company trying to prove that electric cars could become something more than a niche product.

The change also did not erase what had happened to the people who worked there before.

For thousands of NUMMI employees, April 2010 meant lost jobs and the end of routines built over years or decades. Tesla's arrival could give the building a new purpose, but it could not turn that difficult morning into something that had never happened.

That is what makes the factory's story unusual.

The same building could hold two very different moments only months apart.

On one morning, employees watched a red Corolla become the last car their factory would make.

Later that year, another company opened the doors and began preparing for cars that had not yet reached customers.

The machines, walls and production floor were still there.

What changed was what people believed could be built inside them.