Tesla Motors Considering its Own Lithium-Ion Battery Plant?


No Lithium-Ion Battery Pack, No Tesla Motors
No Lithium-Ion Battery Pack, No Tesla Motors

Elon Musk, CEO of Tesla Motors, has bold plans for the electric vehicle, but meeting that plan is probably worthless without an adequate supply of lithium-ion battery packs.

The lithium-ion battery is to the Tesla Model S [and upcoming models] what chicken is to chicken soup. If you don’t have any chicken in the fridge, you’re not making chicken soup. If you want to corner the market on chicken soup, you better have your own supply of chickens. The supply of lithium-ion battery packs is the biggest bottleneck in the making of electric vehicles. Tesla Motors may be just one electric vehicle manufacturer, but as more companies get into electric vehicle manufacturing, this supply will become even more uncontrollable.

According to Elon Musk, after the release of the Tesla Model X, there’s a mass-market Tesla in the works, better than 500,000 per year production. A new extended agreement between Tesla Motors and Panasonic for an increased supply of the 18650 lithium-ion battery seems to coincide with future production increases, but two billion cells over the next four years isn’t nearly enough to cover 500,000 Tesla Model E [a rumored model name] per year.

Unfortunately, Tesla Motors has already held back on its advertising and production rates, due to lack of lithium-ion battery packs, so what’s going to happen in the future with a mass-market model? “It doesn’t make sense for us to amplify demand if we aren’t able to deliver,” said Tesla Motors CEO Elon Musk earlier this year. It looks like Tesla Motors is going to have to build its own lithium-ion battery plant, and a recent conference call with Elon Musk seems to point in that direction. Elon Musk said “This will be a giant facility. We are talking about something that is comparable to all of the lithium-ion battery production in the world, in one factory… mostly likely in North America.”

Image © Martin Gillet Foter.com CC BY-NC-SA

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