Connect with us

Cars & Concepts

Musk’s Battery Bet: Tesla’s 4680 Cells Struggle to Undercut Supplier Costs Despite $46 Billion CEO Package

Published

on

Musk Claims Purchasing Electric Vehicle Batteries from External Vendors is More Cost-Effective Than In-House Production

During Tesla's yearly meeting with shareholders on Thursday, CEO Elon Musk described his role in the company's trajectory as a beneficial catalyst, while shareholders greenlit a compensation plan for Musk worth $46 billion, contingent on the present value of the stock.

In 2024, a key factor that was anticipated to alter the course of the company, lower expenses, and facilitate the production of a $25,000 Tesla electric vehicle by 2023 and the large-scale manufacturing of the Semi by 2021 has not materialized: the significant decrease in the price of Tesla's 4680 battery cells.

Musk emphasized that while they are on track to achieve cost equivalence with their cell production by the end of the year, it is a challenging goal to reach.

During Battery Day, Musk shifts focus to matching costs

As Musk discusses achieving equivalent costs, Tesla's landmark strategy involving its batteries has evolved considerably since its unveiling at the September 2020 Battery Day. At that event, Tesla spotlighted the 4680 cells and its own forthcoming manufacturing of these cells as the key highlight. The company asserted that it could produce this innovative cell at a 50% reduced cost compared to what suppliers charge, based on energy capacity. Tesla even suggested the possibility of providing these cells to other car manufacturers.

Examining the Differences Between the 4680 and the 2170 –

On Thursday, Musk disclosed that the price of our 4680 batteries is presently higher than that of our suppliers. He pointed out the fluctuating nature of the costs associated with electric vehicle batteries. He stated that although they are more expensive now, they were actually cheaper than the suppliers' prices a year earlier.

He mentioned that there's an inconsistency in the supply of battery cells, similar to what's seen with VRAM chips. However, he anticipates that by year's end, they will manage to match or even significantly undercut the current prices offered by cell suppliers.

Tesla's major investment in batteries hasn't yielded returns so far

The pricing of electric vehicle (EV) battery cells has certainly fluctuated wildly. Following Battery Day, the cost for EV batteries escalated to unprecedented levels in 2022, affecting the cost-effectiveness of EVs. Prices for lithium-ion batteries have been on the decline throughout 2023 and continue to fall this year, with no indication of a plateau. Analysts at Goldman Sachs predict that the prices for EV batteries will drop by almost 40% from 2023 to 2025, which is expected to stimulate an increase in sales.

Tesla's Battery Event – Larger Scale Reduces Expense

From various angles, the financial dynamics of the electric vehicle (EV) battery market have undergone a significant shift since Battery Day. Currently, there's an overwhelming surplus of battery manufacturing capability, especially when looking at China's production. A recent evaluation by Bloomberg New Energy Finance from earlier this year indicated that China alone is producing a sufficient number of batteries to meet the entire global demand for EVs. Furthermore, when it comes to design, no other major car manufacturer has pledged to adopt the 4680 cylindrical battery model (measuring 46 mm in diameter and 80 mm in height). For example, BMW has chosen to go with the 4695 battery model, which maintains the same 46 mm diameter but extends the height to 95 mm.

Musk stated in 2021 that Tesla's mass production of the Semi would be unfeasible without the company manufacturing its own 4680 battery cells. It was during this week's event that Musk verified the Semi has reached a level of increased production.

In 2021, the chief of Panasonic's battery division mentioned that large-scale production of the 4680 battery cell would necessitate innovative methods. However, this challenge has not deterred other leading battery manufacturers from competing to produce this new model.

The 2025 model of the Tesla Cybertruck, presented by Tesla, Inc.

During Tesla's first-quarter earnings call in April, Engineering Vice President Lars Moravy provided an update on the production of the 4680 battery cells. He indicated that the current output is on track to reach approximately 7 gigawatt-hours annually. This rate is sufficient to meet the manufacturing demands of the Cybertruck, the sole vehicle model that utilizes these cells.

Musk has indicated that while Tesla might be on par with competitors in terms of battery technology, achieving a 50% reduction in cost seems just as unlikely today as it did back in 2020.

Labels:

Participate:

Spread the Word:

Get in Touch with the Author:

Stay Updated:

Eco-Friendly Vehicle Digest

Register to receive daily updates on eco-conscious vehicles and sustainability news straight to your email!

I consent to getting email communications from Green Car Reports. I acknowledge my right to opt out of these emails whenever I choose. Privacy Policy is acknowledged.

During the yearly gathering of stockholders, Chief Executive Officer Musk highlighted the importance of pricing accessibility

Honda is gearing up to offer less expensive electric vehicles by introducing a battery rental service. Volkswagen enhances its ID.4 electric vehicle and broadens the capabilities of its ChatGPT feature. Jeep unveils details on its upcoming model, which is anticipated to be priced at $25,000 and may hit the market in the following year. Additionally, there's a discussion on whether the method of incorporating EVs into the U.S. fuel economy standards needs an overhaul. Stay tuned for more on these developments…

Present national regulations on fuel economy calculate electric vehicles' efficiency based on a standard equivalent to that of petroleum, which essentially encourages the purchase of EVs.

During its yearly meeting with shareholders, Stellantis announced plans to release an electric Jeep Renegade model in the United States by 2027.

Developing a thorough enterprise centered on battery technology could lead to cost-effective electric vehicles and a reduction in carbon emissions.

The upcoming Volkswagen ID.4 model for the year 2025 retains its enhancements from the previous year, such as increased battery capacity and driving distance, improved user interaction, and an advanced AI-powered voice assistant.

Porsche expands its app with numerous new charging stations. The EV tax credit at purchase is gaining traction. Could plug-in hybrids contribute to increased future oil consumption? We delve into these topics at Green Car Reports. Bloomberg New Energy Finance's latest report on annual EV sales hints that plug-in hybrids could unpredictably affect oil consumption. As plug-in hybrids gain popularity and evidence indicates they operate on electric power for only 11-54% of the time, their preference over electric vehicles might lead to higher than anticipated oil usage. Moreover, if these hybrids are actively promoted in the market…

Regulatory bodies view them as electric vehicles, yet Bloomberg's energy research division indicates they could increase oil consumption if chosen over battery-powered EVs.

Many sites also cater to plug-in hybrid vehicles by providing Level 2 destination charging stations.

Following an initial period of sluggish uptake in early 2024, the point-of-sale discount has rapidly emerged as the preferred method for applying the electric vehicle tax incentive.

We embark on an initial test drive of the 2025 Honda Civic Hybrid. The 2025 Nissan Leaf is once more stripped of its electric vehicle tax incentive. Meanwhile, as Tesla's Supercharger expansion hits a snag, Ionna gains momentum. All this and more can be found right here at Green Car Reports. Upon evaluating the 2025 Honda Civic Hybrid, we discovered this particular model to stand out in its category…

Associated Content

Top Choices

Imagery

Updates

Press

Feeds

Business

Connect With Us Now:


Discover more from Automobilnews News - The first AI News Portal world wide

Subscribe to get the latest posts sent to your email.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

SUBSCRIBE FOR FREE

Advertisement
Cars & Concepts3 hours ago

Musk’s Ultimatum: Fix 4680 Battery Woes or Tesla’s Project Faces the Axe

F14 hours ago

Drama Unfolds: Norris Grabs Pole as Tsunoda Crashes in Thrilling Hungarian GP Qualifying

F15 hours ago

McLaren Under Fire: Top Management Fumes Over Costly F1 Blunders Amid Growing Internal Pressure

F15 hours ago

Under Pressure: Sergio Perez’s Hungarian GP Qualifying Crash Intensifies Red Bull Scrutiny

Automakers & Suppliers6 hours ago

Unveiling Ferrari’s Cutting-Edge Innovations: A Deep Dive into the Supercar Icon’s Latest Technologies and Developments

F16 hours ago

McLaren Dominates: Norris Takes Pole, Piastri Secures P2 in Thrilling Hungarian GP Qualifying

F16 hours ago

McLaren Locks Out Front Row in Hungary as Perez’s Struggles Continue

F17 hours ago

George Russell Fumes Over ‘Fundamental’ Mercedes Blunder Leading to Q1 Exit at Hungarian Grand Prix

F17 hours ago

Front-Row Triumph for McLaren: Norris and Piastri Lead the Starting Grid at 2024 Hungarian Grand Prix

F18 hours ago

Underperformance Blues: Toto Wolff Slams Mercedes’ Qualifying Woes at Hungarian GP

Moto GP8 hours ago

Captain Abandons Ship: Aleix Espargaro’s Loyalty Questioned as He Jumps from Aprilia to Honda

Automakers & Suppliers8 hours ago

Unveiling Lamborghini’s Latest Innovations: The Pinnacle of High-Performance and Luxury in Italian Supercars

F18 hours ago

Struggling to Adapt: Lewis Hamilton Opens Up About Frustrations with F1’s New Generation Cars

Moto GP8 hours ago

Pramac-Ducati Split: Competitiveness Sparks ‘Cracks’ Leading to Yamaha Alliance

F19 hours ago

Defiant Perez Sees ‘Light at the End of the Tunnel’ Amid Red Bull Woes and Future Speculation

Moto GP9 hours ago

Pedro Acosta’s Quest for Answers: KTM HQ Visit to Revitalize MotoGP Season

Moto GP9 hours ago

VR46 Eye Franco Morbidelli for 2024: Shifting MotoGP Landscape Could Reunite Old Friends

Moto GP10 hours ago

KTM’s ‘Tough Love’: Vinales Set for Shake-Up After Aprilia’s Patience

Moto GP2 months ago

Enea Bastianini’s Bold Stand Against MotoGP Penalties Sparks Debate: A Dive into the Controversial Catalan GP Decision

Sports2 months ago

Leclerc Conquers Monaco: Home Victory Breaks Personal Curse and Delivers Emotional Triumph

Moto GP2 months ago

Aleix Espargaro’s Valiant Battle in Catalunya: A Lion’s Heart Against Marc Marquez’s Precision

Moto GP2 months ago

Raul Fernandez Grapples with Rear Tyre Woes Despite Strong Performance at Catalunya MotoGP

Sports2 months ago

Verstappen Identifies Sole Positive Amidst Red Bull’s Monaco Struggles: A Weekend to Reflect and Improve

Moto GP2 months ago

Joan Mir’s Tough Ride in Catalunya: Honda’s New Engine Configuration Fails to Impress

Sports2 months ago

Leclerc’s Monaco Triumph Cuts Verstappen’s Lead: F1 Championship Standings Shakeup After 2024 Monaco GP

Sports2 months ago

Leclerc Triumphs at Home: 2024 Monaco Grand Prix Round 8 Victory and Highlights

Sports2 months ago

Perez Shaken and Surprised: Calls for Penalty After Dramatic Monaco Crash with Magnussen

Sports2 months ago

Gasly Condemns Ocon’s Aggressive Move in Monaco Clash: Team Harmony and Future Strategies at Stake

Business2 months ago

Driving Success: Mastering the Fast Lane of Vehicle Manufacturing, Automotive Sales, and Aftermarket Services

Business2 months ago

Shifting Gears for Success: Exploring the Future of the Automobile Industry through Vehicle Manufacturing, Sales, and Advanced Technologies

Business2 months ago

Driving Success in the Fast Lane: Mastering Market Trends, Technological Innovations, and Strategic Excellence in the Automobile Industry

Tech2 months ago

Driving the Future: Exploring Top Innovations in Automotive Technology for Enhanced Safety, Efficiency, and Connectivity

Business2 months ago

Driving Success: Mastering the Automobile Industry with Key Insights on Vehicle Manufacturing, Automotive Sales, and Beyond

Business2 months ago

Hong Kong’s Ambitious Leap: The City’s Strategic Roadmap to Becoming a Global Innovation and Tech Hub

AI2 months ago

Revolutionizing the Future: How Leading AI Innovations Like DaVinci-AI.de and AI-AllCreator.com Are Redefining Industries

Tech2 months ago

Revving Up the Future: Top Automotive Technology Trends Driving Sustainability, Safety, and the Electric Revolution

V12 AI REVOLUTION COMMING SOON !

Get ready for a groundbreaking shift in the world of artificial intelligence as the V12 AI Revolution is on the horizon

SPORT NEWS

Business NEWS

Advertisement

POLITCS NEWS

Chatten Sie mit uns

Hallo! Wie kann ich Ihnen helfen?

Discover more from Automobilnews News - The first AI News Portal world wide

Subscribe now to keep reading and get access to the full archive.

Continue reading

×