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The highly anticipated Battery Day will take place on September 22nd. Tesla is expected to showcase its plans to increase battery capacity, improve cell chemistry and performance, and drive down cost. This means faster and more production—and ultimately better products at lower price-points. The latter is especially critical, if Tesla is to be successful in weaning the world of its noxious reliance on fossil fuels.
Cathie Wood of ARKInvest shared some thoughts on Tesla's accomplishments that the company might unveil on September 22nd at Battery Day. Wood suggests possible announcements: "an 18% decline in the cost of EV's battery pack systems for every cumulative doubling in EV demand or a more fundamental breakthrough?" She ponders whether a 90%+ decline in each of the three important variables—assembly line labor costs, cell cost saving per unit of energy, and factory floor space—could change the slope of the line, accelerating the decline in costs from 18%.
Wood also notes that according to a study by one of the firm's analysts, other electric car companies are already 3-4 years behind Tesla in battery technology. That's why she wonders: Will Tesla present at Battery Day something that further extends this already significant lead?
According to @skorusARK research, other companies focused on EVs are three to four years behind $TSLA in battery technology already. The question is whether these breakthroughs will help #Tesla pull away even faster.— Cathie Wood (@CathieDWood) September 20, 2020
There is every reason to believe that Tesla Battery Day will be a decisive, industry-defining event. It is anticipated that the company will announce developments that are beyond game-changing—they could ultimately write the rules of an entirely new sport.
Great batteries are key to successful electric vehicles and the foundation of Tesla's business. And so is their cost. That is why the company must focus on its own battery production, rather than depending on battery suppliers. This way, Tesla can make batteries tailored to its own specifications and timeline needs. Beyond making their own batteries, we expect to see Tesla introduce its own bespoke technology—perhaps including as large as a 4785 sized cell—to dramatically accelerate the speed of production.
Combined with any special technology that could be announced, we expect Tesla to discuss an industry first, sub-$100/kWh battery cell cost, if not substantially below this mark. Of note, the $100/kWh cell cost has been widely considered the crossover point for ICE-based vehicles—where EVs become more affordable and on a large scale.
Competition continues to grow in this area, but the company has long been working to create its own battery cells that suit their own needs. Tesla is committed to reducing manufacturing costs and increasing the lifespan and charging speed of its batteries, which ultimately translates to better vehicles.
At the moment, Tesla already occupies a leading position in this regard; what the company will present at Battery Day should only widen this gap. Reducing production costs, increasing the range of cars, and shorter charging times will no doubt make Tesla cars even more attractive to consumers.
The company's cars are already in high demand, undermining the credibility of automakers still focused on the internal combustion engine. By all accounts, Tesla's new developments are expected to decisively change the automotive industry as we know it. Battery Day could explain the underpinnings of what will ultimately accelerate the world to sustainable energy.
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