Bigger and Cheaper Cells
First of all, Tesla is going to produce new, bigger cells (4680 cells, referring to its size of 46x80mm) with a 5x higher energy capacity, focused on large-scale production.
This cell offers several advantages, as its production process will focus on continuous production, compared to batch-wise production as of now. The main point of the improvement is to get rid of soldering lips, which eases production but also reduces inefficiency. Instead of having a tab in the cells with a lip at both ends, they’re making the top and bottom fully conductive, reducing the distance to electrodes, but allowing further scaling of the entire cell. This should also solve the heating issue (‘Tabless design’). Next to that, Tesla also wants to apply a dry coating, which should minimize fire hazards even further.
Tesla’s new tabless cell design. Image from Tesla.
The impact will be huge: an expected price reduction of 56% could be realised based on $/kWh. But that’s for the entire car. Based on the cell level, Tesla estimated a 49% price reduction. However, they need much more price reduction to sell more cars and they perceive this as a risk.
Scaling Battery Production
State-of-the-art battery cell production with the current NMC-chemistry is not scalable, they’re especially foreseeing problems for the anode and cathode in terms of supply. Suppliers will face scaling issues, so Tesla will focus more on producing in-house. The focus will be on multiple chemistries since focusing on just one chemistry is not scalable enough. Focus is on silicon, nickel, iron, and likely they’ll make a nickel-battery cell without lithium.
Tesla will focus on 100% recycling of cells, as it will be cheaper to recycle than to find new materials.
Elon Musk estimated the global storage demand will be 10 TWh/yr in 2030, whilst he mentioned an estimated production capacity of 3 TWh/yr by 2020, more than all other manufacturers together have scheduled for 2028. In order to have such production capacity, this would require approximately 135 Gigafactories. Since this is not as realistic, the focus is on getting a smaller footprint per factory, but also they will have to rely on other manufacturers for their cell supplies.
Accelerating the Transition
The major hurdle to overcome for the next decade is to allow such production capacities, with a major focus on reduction of cobalt-content also (due to the social implications of cobalt production in countries such as the Democratic Republic of the Congo, as well as supply issues), leading to high risks in their chemistry/production route and having to depreciate their investments. This is a challenge especially in a sector where battery chemistry changes continuously.
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