Can Tesla Meet 2022 Goals For In-House Battery Production?
Tesla CEO Elon Musk has set extraordinary goals for in-house battery production this year. In late 2020, Musk announced that Tesla aimed to halve the costs of the most expensive part of an EV by producing its own batteries. Tesla’s 4680 lithium-ion batteries — with 46-millimeter diameter and 80-millimeter length — hold about 5 times the energy of its current smaller 2170 cells. Tesla can use a smaller number of new cells for the same energy and driving range, reducing costs.
Tesla faces a lengthy process in ramping up its battery factory, though, complicated by plans to use a new manufacturing technology called dry electrode coating.
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Lithium-ion batteries (LIBs) are the storage technology of choice in state-of-the-art EVs, leading to a substantial growth in global LIB production. The priority within the battery technology has been aimed at achieving higher LIB energy capacities to compete with internal combustion engine (ICE) vehicles.
Dry electrode processing is part of the next generation of electrodes, as it reduces costs and eliminates toxicity to meet future battery production demands.
Research indicates that dry electrode mixing and coating would be revolutionary for large-scale LIB production. Solvent omission in dry electrode processing substantially lowers the energy demand and allows for a thick, mechanically stable electrode coating. The dry coating ultimately reduces the slurry preparation and mixing step, lowers drying times, and eliminates the toxic volatile fumes from N-Methyl-2-pyrrolidone (NMP), solvent recovery, and recycling systems.
Compared to wet-processed materials, it is cost efficient and environmentally benign. Further, the dry electrode process may improve energy and power density by enabling unique, dense, high-loading electrode microstructures.
The Difficulty with Battery Manufacturing at Scale
“He is changing the way how battery manufacturing is done,” Shirley Meng told Reuters. “It’s really, really difficult to manufacture at a speed and at scale.” Meng is a University of Chicago professor who previously worked with Maxwell, a battery technology company acquired by Tesla.
The factory equipment for in-house battery manufacturing like this, Musk said, “doesn’t exist. It’s being made.”
Reuters offers a nice explanation about how EV batteries are charged and discharged by the flow of lithium ions between the graphite-containing anode and the cathode. Cathodes contain nickel, which delivers high energy density, allowing the vehicle to travel further. Prices of battery ingredients like nickel hit records this week on supply fears stemming from the Russia-Ukraine conflict, and Musk had already in January forecast battery supply constraints, making in-house production a key to growth.
The pursuit of energy density has driven electric vehicle batteries from using lithium-iron-phosphate cathodes in early days to ternary-layered oxides increasingly rich in nickel; however, as nickel is used in the production of EV batteries, any sanctions placed on Russian nickel will become a barrier to EV manufacturing. Russia was the third-largest nickel producer in 2021, producing over 200,000 tons.
Dry electrode technologies not only offer a way to reduce energy consumption in the battery cell making process — lowering the cost — but such innovations could also allow opportunities to augment the performance of today’s lithium-ion batteries in the near term. Dry electrode manufacturing skips a traditional, complicated step of battery manufacturing that involves the chemical slurry.
If it works, it will be cheaper and more efficient, but Musk freely admits it will be a challenge. “The very difficult part is then scaling up that production and achieving extremely higher reliability and safety with the cells,” he told a European battery conference in November 2020.
Getting By with a Little Help from Its Panasonic Business Partner
Japanese media outlet NHK reported earlier this month that Panasonic plans to construct a US factory to supply Tesla with LIBs, seeking to ramp up production to meet anticipated demand for electric vehicles. With projected building sites in Oklahoma and Kansas, the Panasonic expansion would augment Tesla’s plan to increase its in-house battery manufacturing with the new factory it is bringing online in Texas.
Panasonic intends to begin mass production of the the new type of lithium-ion battery, which is 46 mm in diameter and 80 mm tall, for Tesla by March 2024 on two new production lines at its western Japanese plant in Wakayama. According to Kazuo Tadanobu, the CEO of Panasonic’s energy division, Panasonic’s advantage in the market lies in its capability to “use craftsmanship to maintain safety even while raising the performance of a battery.”
And after leading the development of the next-generation cells, Tabanobu acknowledged that the company prizes its relationship with Tesla and will work to maintain its place in the Tesla battery line. “We don’t want to lose,” the Panasonic executive said.
Panasonic was the first battery manufacturer to work with Tesla when it agreed to manufacture battery cells at the Tesla Gigafactory in Nevada. That relationship has had its ups and downs over the years, and Tesla has forged alliances with other battery manufacturers. Tesla has ramped up production and diversified its supply chain to other firms, including Chinese manufacturers of lithium iron phosphate (LFP) powerpacks such as Contemporary Amperex Technology Co. (CATL).
In 2021, Tadanobu said that Panasonic did not intend to build LFP batteries for standard-range Teslas, even though Tesla’s report said the company plans to start using those in its “standard range” vehicles worldwide.
How the Battery Dilemma Affects Likely Tesla 2022 Deliveries
In 2020, Musk projected that Tesla would have capacity to produce 100 gigawatt-hours of 4680 batteries in 2022, enough to power about 1.3 million cars, and more than enough to supply production at factories in Texas and Germany. More recently, Tesla announced it will start delivering Model Y vehicles with its bigger battery cells by the end of March.
Tesla produced its one millionth 4680 cell in January.
Tesla is expected to deliver about 1.4 million vehicles this year. Industry researcher Benchmark Mineral Intelligence expects the company to produce batteries for about 30,000 Model Y vehicles, growing to 484,000 in 2024, according to a previously unpublished forecast provided to Reuters.
How likely is it for Tesla to achieve anticipated targets to mass produce its own new batteries this year? No one knows for sure, but certainly there are obstacles inherent within opening a new factory and developing a new methodology of battery manufacturing.
The necessity of Tesla’s in-house battery production is imperative to providing the scale necessary for building less costly, longer-range EVs. The competition is sneaking up from behind.
Senior Vice President Drew Baglino said in January Tesla is “making meaningful progress of the ramp curve” in its test battery factory in Fremont, California while installing battery equipment at its upcoming plant in Texas. Baglino said Tesla’s “focus is to drive yield quality and cost to ensure we are ready for larger volumes this year as we ramp and next year.”
As a sign of Tesla’s ambition, its in-house battery production is expected to beat established battery makers Panasonic and LG to market with 4680s.
Of course, lots of chatter surrounds the opportunities within a solid-state battery, which many say is better than a battery with a liquid or semi-liquid electrolytes. It has a lower risk of catching fire, known more precisely as thermal runaway. With higher energy density, solid-state batteries can charge and discharge more rapidly, perform better in cold temperatures, and offer more endurance. Solid-state batteries have been held back from large scale commercialization by two factors: the lower conductivity of the solid electrolyte and the interface instability issues.
Overcoming instabilities that arise at the interface has been the most challenging for researchers. These instabilities can occur during both the manufacturing and the electrochemical operation of such batteries. R&D done at MIT demonstrates the importance of controlling the gas environment during the sintering process to obtain good contact between the ceramic cathode and ceramic electrolyte in solid state batteries. Co-sintering the cathode and electrolyte in O2 environment gives chemically stable interface with low interfacial resistance.
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