Tesla’s Next Disruption Is Next-Gen Battery


Panasonic 18650 High Capacity Lithium Batteries

Panasonic 18650 High Capacity Lithium Batteries

While the world eagerly waits the arrival of the Tesla Model 3, it’s Panasonic/Tesla and the battery gigafactory that may well become the next big disruption for Tesla in the electric car industry.

There’s a lot at stake with the gigafactory, but according to Panasonic, the next-gen battery is a big deal.

Per Car & Driver:

“Barring a breakthrough in battery technology, the largest cost savings for Tesla will come from optimizing every aspect of the supply chain. Musk wants to go as far as importing steel and aluminum to stamp out cases for the battery packs. “It’s a lot faster, a lot less linkage, a lot less packaging, and inventory would be reduced,” says Bob Rauh, director of business development for automotive and infrastructure at Panasonic.”

But it’s not just the packaging and manufacturing that will be changed:

“Panasonic is studying new cylindrical-cell geometries that would optimize both the cost and the energy density for Tesla’s needs. Today’s Model S lithium-ion battery already uses a nickel-intensive cathode that is cheaper than the usual cobalt chemistry, but Tesla acknowledges that it is working with new cathode and anode materials for its next-generation battery, hoping to improve cost, density, and longevity.”

So, cells tailored specifically for Tesla, optimized to reduce cost and increase energy density.

Lastly, there’s this from Car & Driver:

“Musk’s ambition—he claims the Gigafactory will supply battery packs for 500,000 cars per year by 2020—means Panasonic could be manufacturing billions of battery cells annually for Tesla. That kind of volume would allow Tesla to create its own economies of scale for a new battery shape rather than depend on the 18650. “The sheer size of the Gigafactory allows us to drive what is the most cost-effective size of the battery,” Rauh says.”

It’s not often that Panasonic discusses this Tesla battery stuff on the record, so this rare conversation with Car & Driver really provides us with some insight into the future plans of the Tesla-Panasonic partnership.

And like we stated above, Tesla’s biggest breakthrough coming in the foreseeable future is likely on the battery front, which is needed to make the Model 3 a reality.  After the battery breakthrough, the electric Tesla for the masses comes and that car promises to change the electric vehicle segment forever.

Source: Car & Driver

Categories: Battery Tech, Tesla

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51 Comments on "Tesla’s Next Disruption Is Next-Gen Battery"

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The cell geometries were covered in a quarterly call earlier this year – JB Straubel stated that the cells would be 10% larger in diameter and length. I estimate they’d go from 18mm to 20mm in diameter, and 72mm in length (18650 -> 20720). The goal is to increase Wh per cell in a way that is still optimized for usage in EV battery packs.

The “breakthrough” is the cell cost. Not some exotic chemistry. It was reported a week or two ago that Tesla will start installing equipment in the factory in mid-2015 and production in 2016. So whatever they want in terms of chemistry and manufacturing needs to be ready to go in a month or two to start ordering the equipment.

I wonder if that will mean that the battery will be thicker than the current one on Model S. Or if Tesla will place the cells horisontally instead.

Seven additional millimeters is imperceptible, about a quarter of an inch. Hardly something that would merit changing the battery architecture for.

Depends, if it’s not planned for you can’t just squeeze a battery in a smaller space. But I have heard that the batterypack itself may be prepared for a larger standard cell, so in that case you are right.



The change in cell size was pedicted in Argonne’s paper. There’s nothing new being announced in this new article.

GM is already going to the new geometry only with prismatics. The new geometry will be in the new Volt before Tesla has it’s factory up and running.

“So whatever they want in terms of chemistry and manufacturing needs to be ready to go in a month or two to start ordering the equipment.”

Not true, a production line can adjust to different chemistry, most of the machines don’t care what they are mixing, depositing, and laminating. Also Musk has said they expect the factory to work with different chemistries.

One thing I don’t like about Tesla’s batteries is that they are more toxic than the ones from GM and Nissan. Nickel and Cobalt are toxic. But I guess if they recycle them, that is fine. Lead-acid batteries are very toxic but they are like 97% recycled these days.

Any metal in high enough doses is toxic.

Nickel may be an essential trace element in mammals. Nickel is in our stainless steel silverware and cookware.

Cobalt is also used in artificial knee and hip joints.

GM’s battery had nickel and cobalt since 2011:
It’s required for higher energy density.

Nissan’s second gen battery will also use nickel and cobalt:

I don’t think you need to worry about EV batteries not getting recycled. The metals in them are too valuable. Sure, a lithium cell phone battery might get thrown in the trash because it is too inconvenient for a person to recycle such a small item. But these large batteries will be worth money and 99% of the time they’ll be removed in a auto service center of some kind and they’ll know what to do with it.

it’s 99% recycling quote for LAB according to Wikipedia.. 😉
Numbers easily achievable for Li-ION from cars as those are bigger and will have to go back through the ‘value-chain’ when the car is disposed of.

So many people are looking for the magical battery breakthrough. Hopefully that will happen but it might not.

But we really don’t need one. With good business practices and economies of scale, the current battery technology can be made affordable and that is what Tesla is doing.

That is correct. With current price level of batteries, cost is affordable enough to supply batteries for about 2 to 4 million electric cars annually. This already is a huge market and it is definitely large enough that the cost of battery production gets optimized. And most importantly, this market is large enough that it encourages companies to invest on R&D and therefore incremental improvements.

If you look at history a new magical battery chemistry has come to be several times. It is naive to think that Lithium-Ion is the end. I believe in more than one electron metals, like magnesium. There has been extensive research about magnesium, but like many things that were invented were “mistakes” in the labs. I expect more “mistakes” in the future.

What I find interesting is that there doesn’t appear to have been any chemistry changes in the Panasonic battery. Chemistry changes in the LG battery in the Volt has increased capacity about 6-7%, so wouldn’t you expect a similar improvement from Panasonic?

Panasonic already has about 50 % higher energy density and therefore lower cost than LG Chem’s EV cells.

Nissan already has three battery factories built, and has produced batteries for 200,000 cars. I would love to know how Tesla’s approach differs from the strategies of other automakers.

Tesla’s gigafactory once at full production can produce battery packs for 500k vehicles *per year* and presumably 200+mile vehicles at that.

Nissan has produced batteries for 200k vehicles over *4 years*, so averaging 50k per year and vehicles with less than 80 miles of range.

The scale is about 10x that of existing manufacturers even before accounting for the larger pack size.

While expecting some sales number in 2020 is interesting, let’s get through this latest oil and gas price drop. This is quite substantial and may lay major pains on the EV industry. We have to tie future demand for evs with what would compel so someone to buy them. Usually economical.

I don’t think it will last more than 6 months. If you look at historical oil price dips they have all been very transitory. Whether you believe the current drop in oil price is due to OPEC trying to force frackers out of business or due to a reduction in demand (or a bit of each) both these forces are going to be short lived… and then the price of oil will rise and probably with a vengeance.

Demand for EV’s will grow because they are a better product, as Tesla has shown. Gas would need to be around $1/gal to really impact EV sales, and that’s unlikely to say the least.

While cheap oil may affect current sales. The manufacturers are smart enough to know it won’t last. So they will continue forward with their plans for EVs.

Don’t worry, now that the election is over it is inevitable that manipulation and prices will go up here in the US.

While I appreciate the scale of the gigafactory, I imagine other automakers can also scale their factories to some degree. I also wonder at what volume economies of scale reach diminishing returns.

The other thing I didn’t mention is that a factory of that scale allows Tesla to vertically integrate the entire process of battery pack production. This is from the raw materials from the same state (Nevada) to the finished pack which is then sent via rail less than 300 miles away to the car factory. That’s something a few distributed battery plants can’t match even if they scaled up somewhat.

This factory looks too big for me I just can not believe that it will make batteries for Only or MAX 500 000 cars. I am almost sure if we calculate the surface area of the roof and see how much energy they will harvest from the sun, not to mention the wind, then we can see that the energy produced + the size of the factory = a much larger volume of batteries. Any thoughts any one?

I seriously doubt anything worthwile can be deduced from the area of solar panels … if they generate more power than they need they will simply sell it and feed it into the grid.

You have a point, but what about the size of it?

Storage batteries for Solar City

And I think a portion of the factory will be dedicated to recycling.

and like re-usable first stage, Recycling is when you get a Real gain in cost efficiency.

I’ve seen estimates that Lead-acid batteries would cost over 300% of present prices if they weren’t designed with recycling in mind.

Tesla might want to spend some money on anti-terror / security training & personnel for their facilities, soon…

Is that you See Through???

I am slightly concerned about the idea of a cell form factor change from the perspective of how much harder that would make up-grading older Tesla cars’ battery packs. If the length, at least, stayed the same then that might make a big difference.

I don’t think the 1/4 inch length difference will cause a problem.

Then the Model-S will be in the same boat as all of the other EVs out there with proprietary battery cells that won’t be in production 10 years from now either. At least the 18650 cells in the Model-S are somewhat standard so you’d still have a better chance of replacing those cells than you would in a Nissan Leaf.

In a much better boat : vertical integration.

“Powered by renewable energy”. Is is the same Gigafactory that got a state sponsored electricity deal in a state which uses almost all fossil fuels for electricity?

I wonder how they would explain that…

By building solar power on the roof of the factory and windmills around it as planned.

It will be interesting to see if and when that happens and to what percentage they will cover their own use.

All of it. Since grid parity was already reached, and solar prices are still falling, they’d be foolish NOT to generate a surplus via any available land, and sell back to the grid.

Tesla’s 10 million square foot factory will be covered in solar panels. At 20% efficiency, that will equate to about 850MWh per day.

Tesla’s choice of sites for its Gigafactory was optimal for several reasons that wouldn’t necessarily benefit other types of factories. First, Reno is also one of the few areas in the world where the Earth’s crust is thin enough to offer access to geothermal energy to access heat from the Earth’s mantle. This will provide non intermittent power to intensive furnace requirements in the manufacturing processes.

There is a lot more calculations going on here besides tax credits…

Never been to Reno, I take it. Grid parity has already been reached a while ago, as the clear, cool air is a solar dream.

Not true Mikael, Nevada actually ranks 26 out of 50 states with about 16% renewable and mainly uses lower carbon NG.


I don’t know about northern Nevada, but here in southern Nevada we use 70% natural gas, 18% coal and 12% renewables as of 2012. I haven’t seen any updated numbers since then. And by 2018 we’ll be coal free.

In a recent article, it was claimed the this factory will ultimately cost $5B to build. If it’s used to produce a million cars, that’s a cost of $5K per car. It’s easy to make a cheap battery of the per unit costs are hidden in the capital costs. Is that Tesla’s game here?

Morgan Stanley figures that GF cell costs will fall to the point of opening new markets, such as stationary storage. And they’re putting their money where their mouth is.

1 million cars is only 2 years of full production. I doubt they plan the plant to only last 2 years. The Nevada incentive package assumes the battery plant will be running at least 20 years.

Am I the only giddy fan of Tesla that does not see this factory operating at peak production in 2020? There is significant ramping up of production of cars that needs to happen… there are going to be more speed bumps for Tesla before they can hit 500k of cars per year and 5 years is not that much time IMO.

Another source of cost cuts according to Tesla is the enormous bargaining power that comes with this scale on the commodity markets.

Be interesting to see if this all transpires… With 0.05% of the worldwide market share of automobiles, Tesla will have to, somehow, start selling more cars, or, get people to stop buying other brands.