Musk Spills A Bunch Of China Battery Gigafactory Details

Tesla Model 3 (Source: China AutoReview)

NOV 3 2018 BY MARK KANE 38

Several manufacturers will supply cells for the Tesla Gigafactory 3 in China

Elon Musk sent a couple of tweets out about battery production, appreciating the extremely hard work of Panasonic at the Tesla Gigafactory in Nevada and additionally revealed some new info on the upcoming Tesla Gigafactory 3 in China.

Tesla and Panasonic currently produce about 60% of global electric car batteries, according to Musk.

The Gigafactory 3 in Shanghai will produce electric cars (initially 3,000 Model 3 per week) and battery modules/packs.

The lithium-ion cells will be sourced locally from several manufacturers, including Panasonic. It’s hard to say for sure whether cells will be produced at the Gigafactory 3 or not, but Musk seems to imply they will not.

“Tesla will manufacture all battery modules & packs at China Giga, as we do today in California & Nevada. Cell production will be sourced locally, most likely from several companies (incl Pana), in order to meet demand in a timely manner.”

“To clarify further, the long-term goal for Tesla mass market products is local production for local markets (at least at the continent level). This is critical to make pricing as affordable as possible.”

Categories: China, Tesla

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38 Comments on "Musk Spills A Bunch Of China Battery Gigafactory Details"

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Pana say their profit is down, but that’s just because they invested so much in Giga I guess

No, not “just because”. Panasonic’s press release gave three reasons for quarterly profits having decreased somewhat… altho they still did make a respectable profit margin.

like tesla, it takes a LOT of money setting up or massively expanding, manufacturing lines.

They’re the only ones seriously trying. All the other manufacturers just do the bare minimum to meet emissions regulations while lobbying to loosen said regulations.

It all comes down to perception. As long as a Legacy thinks it is in its best interest not to pursue EVs aggressively, it won’t. This is why I keep saying that each company will have to feel a significant threat to its ICEv sales before they’ll jump. Tesla selling lots of expensive EVs is no doubt a good thing for all the obvious reasons. But if they can deliver a sizable number of $35K M3s, then they will be encroaching on turf that currently belongs to a bunch of foot-dragging companies we all could name. Those companies will respond with their own EV products, which I still contend have been and are still in development, but we just haven’t heard about them yet.

Evidently, they can not just start making hundreds of thousands of compelling BEVs whenever they choose.

Without Tesla, there certainly would be an EV transition, but Tesla is definitely the only company that is pushing it really really hard.

Perhaps. But a delay of even 10 years would make a lot of difference

If not for Elon, I would guess that nobody in the west would be buying EVs. In addition, the garbage that Chinese companies produce would be much worse than what it is today.

While electric cars are fun and economical to drive, they are not making environmental impact…. there are somwhere between 2 or 3 billions cars in the world and only 60 transport ships in the seas are making as many emissions as 1 billions cars and take this… there is around 60 000 of these ships…

So it’s 60 000 ships (1 trillion cars) vs 2-3 billion cars… cars emission is nothing

Teslas 2018 PHEV+BEV car market share is 12% worldwide (car/battery count). Dont know where Musks numbers come from.

And even if i calculate the produced capacity in kWh with 6000 Model 3s per week the numbers dont add up to 60%, so is he counting cells (and calling them batteries?) knowing that Panasonic cells are the smallest cells on the ev market or is he comparing current Panasonic peak production with old data?

Nevertheless their current production rate is impressive.

Why are you talking market share of cars? Tesla is producing 20 GWh/year at gf1 and 8 GWh/year out of Japan.

What is your GWh/year calculation for all other ev’s. Not busses and not other uses.

Panasonic/Tesla has between 25-30% of global EV battery production. It was 22% in Q1 but the Model 3 ramp pushed it back up. For the first 9 months of 2018:

Pana/Tesla – 13 GWh
CATL – 11.7 GWh
BYD – 6-8 GWh (est)
LG/Samsung/SK – 5-6 GWh
Other Chinese – ~10 GWh
Pana/Toyota, others – 2-3 GWh

Global – 50 GWh

This includes EV buses, which are big in China but a rounding error elsewhere. I don’t know how much of China’s 29-30 GWh total went into buses, but it was much less than half.

Musk’s 60% claim is bunk.

And you include batteries for busses because…? Elon is clearly addressing total batteries for pure battery only automobiles. No hybrids, scooters, skateboards or busses. And he may only be considering packs containing cylindrical cells. We don’t know the basis for his number, but I would not challenge his integrity or math skills.

His integrity is often questionable. Especially when it comes to making himself or the company look better.

He is definitely not talking about cylindrical cells only. Not sure about PHEVs. (They wouldn’t make that much of a difference anyway…)

Oh, I don’t know about that.
I’ve had about an 85% gas reduction via my Volt.

Couldn’t swing a cpo S, commute too long for a leaf…

Don’t let perfect be the enemy of good.

Let me remind you that this is a discussion about battery production. The value proposition of PHEVs is completely irrelevant here — it’s simply a fact that PHEVs having much smaller batteries — along with only half the sales numbers — makes them a pretty small player in terms of total EV battery usage.

He’s obviously talking about current production, as in the last month, not year to date or 2018 projections.

Every week, 7000+ Teslas need around 600 MWh of batteries. That’s a rate of over 30 GWh/yr, and I don’t know how much of your Chinese figures are for EVs and not buses/trucks/stationary. Tesla is likely around 50%.

It’s also likely that Musk is not including batteries used in hybrids. I don’t really agree with such accounting, but he did say EVs instead of plug-ins.

Who knows what he’s talking about? They’ll say things like “more batteries than all other carmakers combined”. CATL isn’t a carmaker, nor are Samsung, LG, etc. BYD also makes buses, so maybe they don’t count.

This article puts Panasonic’s share of EV batteries at 20% in the first half of the year. It says CATL briefly passed Panasonic in May. Tesla’s Q3 surge lifted definitely lifted Panasonic into a strong 1st place, but they don’t dominate. The SNE data includes all EVs, not just buses but also PHEVs which Musk might exclude.

China EV shipments ramp heavily in Q4, so Panasonic/Tesla market share should fall back into the low 20s. Even if they maintain S/X/3 at your 7000+/week rate, which so far they have not.

You don’t know what he is including, yet you know for sure that his numbers are wrong, by making assumptions that are just as arbitrary as his criteria…

If he excludes enough stuff he can get to 60%.

Excluding stuff a reasonable person would include is how marketing people lie. That’s why every US pickup is “#1 in it’s class in towing/hp/torque/whatever”. They define the class to exclude everyone who beats them. Look up the specs of actual competitors and you often see the #1 claim is bunk.

i should have read yours first.
That is exactly the issue with these anti-musk/tesla types.
They really do not care about facts. They will just lie and blast him.

I guess trump continues to teach others.

You call musk a liar and then come around and say that you have no idea of what he is talking about.
Who is the liar?

LG and Samsung do make vehicles for their home market and Asia. The Bolt should have been called The LG BOLT they did all the real work.

While you estimate Tesla/Pana production at 13GWh YTD, reality is that with Model 3 ramped, they are producing 30GWh/year right now.
If we exclude busses, then yes, Tesla Pana makes above 50%. Maybe even close to 60% as Musk claims.

Model 3 ramped very fast in Q2/Q3, but overall China is ramping faster. Even if Panasonic/Tesla achieve 7.5 GWh in Q4 (your 30GWh/year pace), it will be <25% of EV batteries and <35% if you arbitrarily exclude buses.

What makes you think much less than half of China’s YTD EV battery production went into buses? I think it should be more than half — possibly significantly more.

China EV bus market is about 100k/year. It peaked close to 120k in 2016 then declined after fraud crackdowns and such. The vast majority are 160-320 kWh models, though some have smaller batteries (including PHEV buses) and BYD probably sells a few of their 500+ kWh flagships.

That puts bus battery market at 20-25 GWh. Total China EV battery market should be ~55 GWh this year. China car EVs were once dominated by ~20 kWh PHEVs and minicars, but the new subsidy regime is driving a shift to larger capacity NMC batteries. If the 1.1-1.2 million EVs sold this year average 25 kWh, that will be 27-30 GWh for cars vs. 20-25 GWh for buses.

I neglected China’s EV trucks, vans and other “non-bus” commercial vehicles. I have no good battery data, but it seems they sell ~50k of these per year. Maybe 5 GWh? I’m sure Musk excludes those.

Chinese plus the Korean, AESC, etc. car batteries is 35-40 GWh for 2018. Panasonic/Tesla was close to 20 GWh, or about 35% of the total. Tesla ramped during the year, but so did the Chinese. If you also exclude PHEVs, LiFePO, etc. maybe you can get to 60%.

Unlike passenger cars, I suspect bus production is fairly linear throughout the year. So if annual need is 20 – 25 GWh (which is more or less what I would assume myself), that would mean that of the ~30 GWh in Q1-Q3, almost 20 went to buses, leaving only a bit over 10 for passenger cars. With the larger sales in Q4, it might end up close to 20 GWh for the whole year.

When Elon made that claim in early Q4, the current run rate of Chinese makers must have been somewhere between the slow first three quarters and the year-end rush — so I’d assume it would be more or less in line with the yearly average of less than 20 GWh. If Panasonic/Tesla at that time had ~30 GWh run rate (might be a bit more, depending on how fast Panasonic is ramping), and adding ~8 GWh for the rest of the world to the Chinese 50%…

Keep in mind that a Model S 100 (~100 kWh battery) has more than tenfold the battery capacity than the typical PHEV with ~8 kWh capacity.

If I were Elon, sourcing cells from local China producers will make me skittish.
Been there, done that. Even with stringent specs, external quality audits, we still see quality issues periodically.
Then again, I lay the blame on us American corporations. They ink a large contract with a producer, so the producer ramps up capacity, then upon the next contract negotiations, the US company then demands a price reduction. So the producer sneakily cuts corners. We even had to check the grade of Aluminum from time to time. We’d had cases where they snucked in different grades at random batches. Sigh, more fried brian neurons for Elon.

I’m thinking it’s a big enough operation that they can afford to thoroughly analyze the quality of their input materials, whether cells or electrodes or raw materials.

Tesla will certainly have a quality control for incoming raw materials and items. And with the growth of Tesla, so does the demand. Suppliers tend to cheat less at the risk of loosing a major customer (a recall can be very expensive, and when it is because of an off spec part, the manufacturer of said part is on the line if the contracts alow for it), while a small customer might be just negligible so it is no risk in cutting corners there.
Also, its China. Eager alternative suppliers are right around the corner, waiting for their chance.

It’s either sourcing from local suppliers, or not getting certified for the huge EV incentives…

First, it would not matter if you lowered prices or not. The Chinese would STILL cut corners.
Secondly, I agree with you. The model 3 is actually Tesla’s spec AND formula. To get that same spec/formula, they are going to have to tell the Chinese how to make the cells. Once they do that, China will likely increase subsidies for Chinese cars, while doing everything possible to kill off tesla.

the should finally care about the source of the electricity(still very dirty… ) in the production line of very energy consuming batteries,EVsetc!!!

A dew years ago Panasonic CEO was grateful for Tesla partnership as it helped them transition from just being an Electronics Giant.The SKoreans have stolen the marketshare in electronics they now dominate in FS TVs and cellphones ,even Sony is down, Partnering with Tesla has helped Pana diversify its business and will make it a good source of battery cells .