Musk offered few details, but reports have said the company hopes to begin European production by 2021.
In a later interview with trade magazine Auto Express, the serial entrepreneur said Brexit had influenced the company's choice as it had "made it too risky to put a Gigafactory in the United Kingdom".
Energy-Storage.news reached out to Tesla to ask how focused the new factory is likely to be on its stationary energy storage products, Powerwall, Powerpack and Megapack and whether any solar equipment will be manufactured in Berlin, but had not yet received a response at the time of publication. He also said that Tesla would set up an engineering and design centre in Berlin.
Brandenburg is in a state of "great euphoria", over Elon Musk's announcement that he has picked the German state that surrounds Berlin as the place to build his first European plant, local politician Erik Giese said on Wednesday. And the Model 3 commands a higher average price ($50,528) than the 3 Series ($46,477), according to Bloomberg's estimate and data cited from Edmunds.
Tesla has started giving media test drives for its first made-in-China Model 3 at its brand-new Shanghai Gigafactory 3, Electrek reported, a mere nine months after breaking ground on the site.
No one from Tesla was immediately available to comment.
"When you have a technology that's unproven you say 'does it really make sense to place a bet on this technology?'" Musk said onstage with Volkswagen CEO Herbert Diess.
"Some of the best cars in the world are made in Germany, everyone knows that German engineering is outstanding", said Musk. He acquited Grohmann, a German engineering company in Rhineland-Palatinate, in 2017.
Germany's own carmakers have been tight-lipped about the news - VW has just started production of its electric VW ID.3 at Zwickau, eastern Germany - but there is no doubt that Musk bringing the fight to their doorsteps piles up the pressure on them. Batteries are made in Nevada and then shipped to Tesla's auto factory in Fremont, California, for final assembly.
Earlier this month, Tesla surprised the stock market by posting a profit of $143m for its third quarter, a light moment after it lost over $1bn in the first half of the year amid struggles to control costs around its production lines.