The secret behind Elon Musk’s goal of selling 20 million Teslas a year by 2030 lies in his pioneering battery technology. The good news is that by using larger cells and a new process for dry-coating the electrodes, Tesla could cut the cost of a Model Y battery in half, saving more than 8 percent of the car’s starting price in the United States, said battery experts with ties to the company.
The bad news is that it’s only halfway there, according to 12 experts close to Tesla or familiar with its new technology. This is because the dry-coating technique used to produce Tesla’s largest 4680 battery cells is so new and unproven that the company is struggling to ramp up production to the point where savings are being felt, experts told Reuters.
“They’re just not ready for mass production,” said one of the experts close to Tesla. Still, the gains Tesla has already made by reducing battery production costs over the past two years could help boost its profits and solidify its lead over most of its rivals in the electric vehicle (EV) space.
Investors see Mr. Musk’s promised improvements in battery cost and performance as essential for Tesla to enter an era where it can sell an electric vehicle for $25,000 at a profit, and have better chance of achieving its 2030 goals.
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Battery systems are the costliest part of most electric vehicles. The manufacture of efficient packages at a lower cost is therefore essential to produce affordable electric cars, capable of competing with their competitors with combustion engines at the level of purchase price.
Tesla is one of the few major automakers to produce its own EV batteries, and by manufacturing the Model Y cells in US factories, the SUV will remain eligible for US tax credits when many rival EVs may no longer be eligible. be entitled to it.
Of the 12 battery experts Reuters spoke to, nine have close ties to Tesla and three of them have looked closely and closely at Tesla’s new and old battery technologies as they take them apart. Tesla did not respond to requests for comment.
“HE WILL SOLVE THE PROBLEM
Sources predict that Tesla will struggle to fully implement the new dry-coat manufacturing process before the end of this year, and possibly not even before 2023.
Stan Whittingham, co-inventor of lithium-ion batteries and 2019 Nobel laureate, believes Tesla Chief Executive Elon Musk has been overly optimistic about the new technique’s time to market.
“I think he will solve it, but not as quickly as he wants. It will take some time to actually test it,” he said. In August, Mr. Musk told shareholders that Tesla would produce high volumes of 4680 batteries by the end of 2022.
Experts say Tesla has only been able to reduce the cost of the Model Y battery by $2,000 to $3,000 so far, about half of the savings Tesla had predicted for the 4680 battery, which it has unveiled two years ago.
But those savings are mainly due to the design of the new 4680 cells, which are larger than those of Tesla’s current 2170 battery, they said. But the heart of the cost-cutting campaign is the dry-coating technology, which Musk described as revolutionary but difficult to implement.
According to the sources, it should deliver up to half of the $5,500 in savings Tesla hopes to achieve, by reducing manufacturing costs and one-time capital expenditures.
Tesla acquired this know-how in 2019 when it paid more than $200 million for Maxwell Technologies, a San Diego company that makes supercapacitors, which store energy for devices that need fast bursts of electricity. , like camera flashes.
Leveraging technology from Maxwell, Tesla began manufacturing 4,680 dry cell batteries this year, first in a pilot project near its factory in Fremont, California, and more recently at its new global headquarters in Austin, Texas.
This technology allows Tesla to abandon the older, more complex and expensive wet coating process. It is expensive because it requires a significant amount of electricity, machinery, factory space, time and a large workforce.
To wet-coat the electrodes, battery manufacturers mix the materials with toxic binder solvents. Once coated, the electrodes are dried in huge ovens, and the toxic solvents that evaporate in the process are collected, treated and recycled, adding to the cost.
With the new technology, the electrodes are coated with different binders using few liquids, so they do not need to be dried. This means that it is cheaper, faster and also less damaging to the environment. Due to its simplicity, this process allows Tesla to reduce capital expenditure by one-third and reduce a factory’s footprint and energy consumption to one-tenth of what would be needed for the wet process. , Tesla said.
But the company has had difficulty commercializing the process, the sources say. Maxwell developed its dry coating process for supercapacitors, but the problem with coating electric vehicle battery electrodes is that they are much larger and thicker, making consistent quality coating difficult at mass production speeds.
“They can produce in small volume, but when they started producing in large volume, Tesla found itself with many rejections, too many,” one of the sources with ties to Tesla told Reuters.
Production yields were so low that any cost savings anticipated from the new process were lost, the source said. If all of the potential efficiencies of dry coating and larger cells are realized, the manufacturing cost of the Model Y 4680 battery pack should drop to $5,000-$5,500, or about half the cost of the block 2170, according to sources.
The increasing cost of battery materials and energy, however, jeopardizes these predictions, and Tesla has not yet been able to significantly improve the energy density of the new battery or the amount of energy that she’s boarding, as Mr. Musk promised.
Yet despite these factors, the savings Tesla is expected to make will make the 4680 battery “best in class” for the foreseeable future, according to one source.
Much of the $2,000 to $3,000 savings made so far with the 4680 battery have come from other improvements, and using larger cells has proven particularly effective, experts say.
The 4680 cells are 5.5 times larger in volume than the 2170 cells. The old cylindrical cells are 21 mm in diameter and 70 mm in height, hence their name. 4680 cells have a diameter of 46 mm and a height of 80 mm.
With the old technology, Tesla needs about 4,400 cells to power the Model Y and there are 17,600 soldering points – four per cell – to create a pack that can be integrated into the car, the sources said. .
The 4680 battery pack only requires 830 cells, and Tesla changed the design so that there are only two solder points per cell, reducing soldering to 1,660 points and making it possible to significant savings.
The simpler design also means there are fewer connectors and other components, which saved Tesla more on labor costs and machine time.
Another source of efficiency was the much sturdier outer casing of the large airframe. Tesla can now glue the cells together with adhesive to form a rigid honeycomb-like assembly that is then attached directly to the internal structure of the Model Y body.
This eliminates the intermediate step of grouping the cells into larger modules which are then installed in a traditional battery pack, the sources said.
By adopting this “cell-to-vehicle” design, Tesla can reduce the weight of a traditional 1,200-pound battery pack by 55 pounds or more, representing a savings of $500 to $600 per pack, according to the one of the sources.
But mastering the dry coating technique remains the holy grail. “Increasing the battery cell volume has helped a lot to improve efficiency, but pushing for a 50% reduction in overall cell cost is another matter,” a source said. “It will depend on Tesla’s ability to successfully deploy the dry-coating process in a factory.”
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