Tesla Giga Texas Battery Factory Will Enable 70% Lower CapEx per GWh than Industry Norm (2024)

4680

By Eva Fox

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Tesla Giga Texas Battery Factory Will Enable 70% Lower CapEx per GWh than Industry Norm (1)

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Tesla continues to improve the 4680 battery cell and its production methods. The Tesla Giga Texas battery factory will provide 70% lower CapEx per gigawatt hour than typical cell factories, according to a management statement.

The Tesla battery cell presented at Battery Day in 2020 is a strong competitive advantage for the manufacturer. The production and use of 4680 battery cells in the company's vehicles will reduce the overall cost of the cars, making them affordable to even more consumers. The progress of the company in this direction is very important for the company and its investors, which is why Tesla management gave an update during the Q1 2023 Earnings Call.

Andrew Baglino, SVP, Powertrain and Energy Engineering at Tesla, recalled that on Battery Day, the company presented a plan to reduce costs through 2026 across five areas of effort. Tesla discussed the cell design, anode and cathode materials, the structural pack concept, and the cell factory itself. SVP said that since then, the company has made progress in all these areas.

Baglino also mentioned the progress of the 4680 battery start-up at Giga Texas, sharing more specific details. According to him, the factory is halfway through construction and commissioning. Once it is in full operation, selling and operating will be 70% lower CapEx per gigawatt hour than typical cell factories. Baglino said the company continues to look for densification and investment reduction opportunities at future factories such as Nevada.

“For the cell factory, the Texas 4680 factory is partway through building and commissioning and selling and operating will be 70% lower CapEx per gigawatt hour than typical cell factories when fully ramped, in line with what we described on Battery Day.”

Another interesting detail is that Tesla is working not only with the first generation 4680 cells, which wereintroduced in 2020 but with the second, a “more manufactural version in Texas today,” according to Baglino.

The company also said it would start building the Corpus Christi Lithium refinery in May. Tesla's goal is to start commissioning part of the facility before the end of 2023. To obtain lithium there, the company will use “the sulfate-free spodumene refining process with reduced process costs, no acid or caustic reagents, lower embodied energy. It actually produces a beneficial byproduct that can be repurposed in construction materials,” Baglino said.

He said that as far as the cathode precursor is concerned, Tesla has successfully demonstrated the “lower process cost, zero waste water precursor process that we described on Battery Day at both lab and pilot scale and are in the detailed design phase for incorporating this technology into the front end of our Austin cathode facility.” In cathode manufacturing, Tesla has installed 50% equipment and 75% utilities in a new cathode building in Austin, with the goal of starting dry and wet commissioning this quarter and next quarter with a target to produce first material before the end of the year.

Baglino also said Tesla saw big improvements in battery pack manufacturing with the 4680 cells and the structural pack concept. A 50% lower CapEx and 66% smaller factory for the same output in gigawatt hours per year was seen.

In Q1 2023, the 4680 cell development and production team achieved significant improvements in price and quality. Giga Texas production increased by “50% quarter-over-quarter, through yields increased 12% and peak rate increased by 20% and through yields improved by 20%. Altogether, the team accomplished a 25% reduction in COGS over the quarter and we are on track to achieve steady-state cost targets over the next 12 months. And going forward for the rest of the year, the priority one is to yield in cost for the 4680 program as we steadily ramp production ahead of Cybertruck next year,” Baglino said.

© 2023, Eva Fox | Tesmanian. All rights reserved.

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Article edited by @SmokeyShorts; follow him on Twitter

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Tesla Giga Texas Battery Factory Will Enable 70% Lower CapEx per GWh than Industry Norm (2)

About the Author

Eva Fox

Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.

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Tesla Giga Texas Battery Factory Will Enable 70% Lower CapEx per GWh than Industry Norm (2024)

FAQs

How many GWh does Tesla produce? ›

Build Big Batteries

Megafactory is one of the largest utility-scale battery factories in North America, capable of producing 10,000 Megapack units every year, equal to 40 GWh of clean energy storage.

Is Giga Texas the biggest factory in the world? ›

Is Giga Texas the biggest factory in the world? No, but it is the second largest factory in the United States, and the second largest building in the world by volume.

What is the production capacity of Gigafactory 1? ›

Fremont, California — the first Tesla gigafactory — has manufacturing capacity for 550,000 Model S and Model X vehicles annually and 100,000 Model S and X vehicles. Tesla's Nevada factory is where it will eventually produce the Tesla 18-wheeler Semi, thanks to a $3.6. billion investment it announced in 2023.

How much power does the Tesla Gigafactory use? ›

A battery factory of that size is estimated to consume 100 megawatts (MW) of power at peak capacity or 2,400MWh per day, according to Navigant Research.

How many GWh does a nuclear power plant produce? ›

Gigawatt hours is a measure of total energy produced over time. A typical plant may be around 1 GW Output power. If it runs full time for a year (8760 Hours less some down time for refueling) then it will have made nearly 8000 GW-hours each year. Over a 50 year life it might produce 400,000 GW hours.

How much is a Tesla powerwall? ›

A Powerwall costs $11,500 with a solar installation through Tesla. If you want to install a Powerwall onto your existing solar system or are using another solar provider, the cost of a Powerwall without installation is $9,200 (though you'll still need a Tesla Certified professional to install it).

Can 100 gigafactories power the world? ›

Elon Musk: “Batteries are critical to a sustainable energy future. “We did calculations… what would it take to transition the whole world to sustainable energy, what kind of [battery cell] throughput would you actually need… You would need 100 gigafactories

Who has the biggest factory in the world? ›

The Boeing Everett factory in Washington, USA is the largest production factory in the world.

How long does it take Tesla to build a Gigafactory? ›

“If you put the building on its side, it's taller than the Burj Khalifa – that's to scale.” Yet, while Burj Khalifa took six years to build, construction teams completed the build of Giga Texas in its entirety in less than two years. Tesla's 2.4 million square foot Giga Berlin was also built in less than two years.

Is the gigafactory bigger than Boeing? ›

It is the country's second biggest factory by size as well as the second-largest building by volume in the world after the Boeing Everett Factory.

How many cars can Giga Texas produce? ›

Tesla Giga Texas (Gigafactory 5) in the U.S. - over 375,000/year.

How many Teslas are made a week? ›

Tesla Giga Texas (Gigafactory 5) in the U.S. - over 375,000/year. Tesla Giga Texas in Austin started production of the Tesla Model Y in April 2022. According to the company, in May 2023, the plant achieved a production rate of 5,000 Model Y (all versions) per week.

What are the disadvantages of Tesla Gigafactory? ›

On the other hand, the Tesla Gigafactory format is optimized for large-scale production, which can be a disadvantage if demand for batteries decreases or if the market shifts towards smaller-scale production.

How much does it cost Tesla to build a Gigafactory? ›

Why is the Tesla Gigafactory so expensive? It will cost about $5 billion. This is because it needs to set up a ton of battery building infrastructure to handle pretty much the entire world supply of lithium ion batteries.

How many Tesla gigafactories are there in the world? ›

Today there are 5 Tesla Gigafactories on 3 continents. The original factory is in Fremont, California, constructed before Musk coined the term Gigafactory. There are Tesla Gigafactories in Nevada, New York, Shanghai, Texas, and Berlin, plus one under construction in Mexico.

How much energy does Tesla generate? ›

In 2023, the company deployed solar energy systems capable of generating 223 megawatts (MW), a decrease of 36% over 2022, and deployed 14.7 gigawatt-hours (GWh) of battery energy storage products, an increase of 125% over 2022.

What is the production capacity of a Tesla? ›

Tesla, the world's largest all-electric car manufacturer, reports a stable installed annual vehicle capacity of 2.35 million units, according to its Q1 financial report.

How much emissions does Tesla produce? ›

Tesla's Scope 1 total carbon emissions reached 211,000 metric tons of carbon dioxide equivalent (mtCO₂e) in 2023. The amount was 202,000 mtCO₂e in 2022. One of the highest increases occurred in manufacturing, from 148,000 to 151,000 metric tons from 2022 to 2023.

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