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% 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.
Indeed, the dry-embedding technique used to produce Tesla’s largest 4680 battery cells is so new and so little proven that the company has trouble ramping up production to the point where the big cost savings kick in. , experts said Reuters.
“They’re just not ready for mass production,” said one of Tesla’s experts.
Still, the gains Tesla has already made by reducing battery production costs over the past two years could help boost profits and extend its lead over most of its rivals in the electric vehicle (EV) space.
Investors see Musk’s promised improvements in battery cost and performance as key to Tesla’s quest to enter an era where it can sell a $25,000 EV at a profit – and have a better chance of winning. achieve its goals for 2030.
Battery systems are the costliest part of most EVs, so making low-cost performance packs is key to producing affordable electric cars that can compete with combustion-engine rivals on purchase price. .
Tesla is one of the few major automakers to produce its own EV batteries, and by manufacturing Model Y cells in US factories, the SUV will remain eligible for US tax credits when many rival EVs may no longer be there. to have the right to.
Of the 12 battery experts Reuters spoke to, nine have close ties to Tesla and three of them have looked at Tesla’s new and old battery technology inside and out. through disassembly.
Tesla did not respond to requests for comment.
IT 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 until 2023.
Stan Whittingham, co-inventor of lithium-ion batteries and 2019 Nobel laureate, says Tesla Chief Executive Elon Musk has been too optimistic about the new technique’s time to market.
“I think he will solve the problem, but it won’t be as fast as he wants. It will take some time to really test him,” he said.
In August, Musk told shareholders that Tesla would produce large volumes of 4680 batteries by the end of 2022.
Experts say Tesla has only been able to cut the cost of the Model Y battery by $2,000-3,000 so far, about half the savings Tesla predicted for the 4680 battery, which it disclosed there. two years ago.
But these 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-coat technology, which Musk described as revolutionary but difficult to implement.
Sources say 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 the 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.
Building on Maxwell’s technology, Tesla began manufacturing 4,680 dry cell batteries this year, first in a pilot near its factory in Fremont, California, and more recently at its new world headquarters in Austin, Texas.
This technology allows Tesla to abandon the old, more complex and more expensive wet coating process. It is expensive because it requires a large amount of electricity, machinery, factory space, time and a large workforce.
To wet coat the electrodes, battery manufacturers mix the materials with toxic binding solvents. Once coated, the electrodes are dried in massive ovens. Toxic solvents that evaporate during the process are collected, treated and recycled, increasing the cost.
With the new technology, the electrodes are coated using different binders with little use of liquids, so they do not need to be dried. This means that the process is cheaper, faster and also less damaging to the environment.
Due to its simplicity, the 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. said Tesla.
But the company has struggled to market the process, the sources say.
Maxwell developed its dry coating process for supercapacitors, but the challenge of coating EV battery electrodes is that they are much larger and thicker, making it difficult to coat them with consistent quality at production speeds. massive.
“They can produce in small volume, but when they started producing in large volume, Tesla ended up with many rejections, too many,” one of the sources with ties to Tesla told Reuters.
Production yields were so low that any cost savings provided by the new process were lost, the source said.
If all of the potential efficiency gains of dry coating and larger cells are realized, the manufacturing cost of the Model Y 4680 battery pack should drop to between $5,000 and $5,500, or about half the cost of the 2170 pack. , according to sources.
The rising 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 power it will deliver. she packs, just like Musk promised.
Yet despite these factors, the savings Tesla is expected to realize will eventually make the 4680 battery the “best in class” in the industry for the foreseeable future, according to one source.
Much of the $2,000-$3,000 savings achieved so far with the 4680 battery has come from other improvements, and using larger cells has proven particularly effective, experts say.
4680 cells are 5.5 times larger than 2170 cells in volume. The old cylindrical cells measure 21 mm in diameter and 70 mm in height, hence their name. The 4680 cubicles have a diameter of 46mm and are 80mm high.
With the old technology, Tesla needs about 4,400 cells to power the Model Y and there are 17,600 points that need to be soldered – four per cell – to create a pack that can be integrated into the car, said the sources.
The 4680 battery pack only requires 830 cells and Tesla has changed the design so that there are only two soldering points per cell, which reduces soldering to 1660 points and provides significant cost savings.
The simpler design also means there are fewer connectors and other components, saving Tesla more on labor costs and machine time.
Another source of efficiency was the much sturdier outer casing of the larger airframe. Tesla can now glue the cells together with adhesive to form a rigid honeycomb-shaped pack which is then connected 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 fitted into 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, a savings of about $500,600 per pack, the Institute said. one of the sources.
But mastering the dry coating technique remains the holy grail.
“Increasing the volume of the battery cell has helped a lot to improve efficiency, but aiming for a 50% reduction in the cost of the cell as a whole is another matter,” a source said.
“It will depend on Tesla’s ability to successfully deploy the dry-coating process in a factory.”