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Elon Musk says Brexit uncertainty was part of decision for Tesla's European factory to be based in Germany instead of the UK

By Ramla Soni

Musk said Brexit uncertainty makes it "too risky" to base factory in the UK

Tesla boss, Elon Musk, has said that uncertainty over the Brexit process has played a part in the firm’s decision to build its first European factory in Germany rather than the UK.

The entrepreneur revealed at an awards ceremony in Germany that the firm’s European battery plant known as “gigafactory” would be built on the outskirts of Berlin near the new Berlin airport.

Although Musk said that “outstanding” German engineering is part of the reason they are locating its gigafactory in Germany, he also told AutoExpress magazine that Brexit uncertainty made it “too risky” to locate in the UK.

Musk said the factory, which is Tesla’s fourth gigafactory, will build batteries, powertrains and vehicles starting with Model Y. Production is expected to start in 2021.

Musk also blamed Brexit uncertainty for his decision to drop plans to build a research and development base in the UK, which will now also go to Germany.

The company already has an assembly site in the Netherlands, but the plans for Germany are on a much larger scale.

In November 2016, Musk said Tesla planned to build an R&D base in the UK. He had previously said that if there was sufficient demand a factory could subsequently be built in the UK, although Tesla planned to open its first European factory on the continent.

As a possible no-deal Brexit weighs down industry investment, even the current deal proposed by the government would involve checks for customs and the origin of parts, that would affect the car industry and electric car industry in particular.

Tesla's European plan comes as the carmaker also moves ahead with a $2 billion (£1.6bn, €1.8) factory in Shanghai.

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