The electric vehicle manufacturer has confirmed that its first European production facility will open near Berlin in 2021, with an engineering and design centre also opening at the site.
Speaking to Auto Express Musk hinted that the UK had been under consideration as the location for the new plant, but lingering doubts over the effects of Britain's drawn-out departure from the European Union put an end to that idea.
"Brexit made it too risky to put a Gigafactory in the UK," said Musk, who previously confirmed to the same title that a research and development site would be opened in the UK – a plan that has since been scrapped.
The new Tesla factory will be situated close to the new Berlin Brandenburg Airport which is set to open next year. It will produce batteries and drivetrains as well as cars, with the upcoming Model Y confirmed as the first car to be assembled at the site.
"We’ve decided to put the Tesla Gigafactory Europe in the Berlin area," said Musk said at the recent Golden Steering Wheel Awards. "I come to Berlin a lot – Berlin rocks!"
"Some of the best cars in the world are made in Germany, everyone knows that German engineering is outstanding," he added. "That’s part of the reason why we’re locating our Gigafactory Europe in Germany."
The Berlin factory joins Tesla's main California factory, its two 'Gigafactories' in Nevada and New York (above), and its new £1.6 billion facility in China (below) which is currently under construction. Once completed, the Shanghai plant will built Model 3 and Model Y cars.
Tesla's rejection of the UK is a fresh blow to the country's car manufacturing industry after Ford, Nissan, PSA, and Toyota all previously warning that it could end some or all of its UK production as a result of Brexit. Honda has already announced it will close its factory in Swindon, although the Japanese firm insists that the decision is not to do with Brexit.
The continued threat of a no-deal Brexit also led to a 15 percent slump in UK car manufacturing for the first three quarters of 2019, will less than a million vehicles being produced between January and September.