According to Reuters, Tesla has suspended plans to manufacture entire batteries in Brandenburg, Germany, and will instead carry out some stages of production in the United States, where tax breaks are more favorable.

The American automaker originally planned to produce the entire battery at its plant in Grünheide, Germany, with a peak capacity of more than 50 gigawatt hours per year.

But with the United States offering tax breaks and consumer rebates to electric car makers that supply batteries inside the United States, the company has changed tack.

“Tesla has started production of battery systems in Grünheide and is preparing to produce battery cell components. The company prioritized the later stages of production in the US, as tax breaks make business conditions there more favorable,” Brandenburg’s economy ministry said in a statement.

Chief Executive Officer Elon Musk said in March 2022 that the battery plant would enter mass production by the end of 2023, but the plant and the car manufacturing company reached their goals later than planned.

In 2020, Musk said that the Berlin platform will become the world’s largest battery factory.

Tesla has had trouble ramping up production of 4,680 battery cells at its factories in Fremont, California, and Austin, Texas, which experts attribute to new and unproven methods the company has had trouble scaling.

In late January, the company announced it would invest more than $3.6 billion to expand its Nevada complex with two new plants: one to mass-produce the long-delayed Semi electric truck and the other to produce the new 4680 battery.