Elon Musk-owned electric car maker Tesla has withdrawn an application for over $1 billion in subsidies for battery production at Gigafactory Berlin.
According to Electrek, a spokesperson for the Germany Economy Ministry confirmed the news in a statement.
“Tesla continues to stick to its plans for the battery factory in the Gigafactory Berlin-Brandenburg, but will do without state IPCEI funding,” the spokesperson was quoted as saying.
After the news came out, CEO Musk made a comment that suggested Tesla withdrew the applications because it does not want any subsidies.
Meanwhile, the Financial Times went into the details of the program and found a clause that might be the cause of withdrawal.
Companies are not eligible for the funds if they have already deployed the same battery production at another plant, the report citing FT, said.
The EU requires any sites in receipt of the funds to be the “first industrial deployment” of the technology, according to official documents, meaning the batteries cannot already be made at another Tesla plant.
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The publication suggested that ongoing delays in achieving approval to start production at Gigafactory Berlin could make Tesla ineligible for the funds since it is also deploying battery production at Gigafactory Texas and Shanghai.
Tesla also already produces its battery cells at a pilot production plant in Fremont, California.