2020-11-17 Tesla Batteries And Supply Constraints

The manufacturing of Electric Vehicles and grid scale storage are constrained by the amounts of batteries that can be supplied by the battery makers around the world.

The early Tesla EVs used the ubiquitous 18650 lithium ion cells, something like 6000 per vehicle. In order to reduce costs and weight Tesla went to the larger sized 2170 cells. Then this fall at Tesla’s Battery Day they revealed that they were producing huge 4680 cells at their pilot plant on Kato in Fremont. The number of cells have been further reduced to several hundred, saving more on costs and weight.

During this past time Panasonic had been producing the 2170 cells for Tesla alongside Tesla in the Gigafactory in Nevada. Even though Tesla has been making batteries like crazy and buying them from outside, they still need many more for the Tesla Powerwalls and Megapacks. Battery supply constraints still dominate.

Tesla has patented the battery advances they have made. Now Panasonic has announced they will be producing the 4680 cells using Tesla’s technology.

Other companies have downplayed the Tesla battery making (see link). But Tesla has signed contracts with battery materials suppliers, so they can keep production going. If there are slowdowns in batteries it affects the production of vehicles. Now that other auto makers want to make EVs, they are finding that making your own batteries has advantages when it comes to supplies.

Perhaps Tesla has contracts with so many suppliers that other auto makers are finding they are having difficulty obtaining batteries for their own cars?? It would make sense since the demand for Lithium ion cells is so great and growing due to increasing EV production. And Tesla is leading the pack with EVs produced worldwide.


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