Published on November 3rd, 2019 | by Chanan Bos0
Tesla Gigafactory 3 Has ~7,000 Battery Packs In Stock For Chinese Model 3 Production, Will Use LG Chem Cells In 2020
November 3rd, 2019 by Chanan Bos
Tesla’s Gigafactory 3 was built in a hurry because both China and Tesla had a lot to prove to the world, and if anyone was betting against Elon, they lost and joined a very long list of people who doubted Musk and were proven wrong.
Building the factory so quickly had some consequences, though. Some components can have lead times as long as a year, especially when you order in bulk. One of the components that Tesla knew would not make it on time: locally produced batteries. To be specific, LG Chem’s 2170 batteries, somewhat similar to the chemical formula Tesla developed in tandem with Panasonic, could not be produced quickly enough. So, some time before August, Tesla found a shortcut: make the car production plant first, produce cars using packs shipped from Gigafactory 1 Nevada in 2019, and start using LG Chem’s batteries as soon as you can in 2020 (that being sometime in Q1 or early Q2). As Elon confirmed in the Q3 investor call, the second Gigafactory 3 (GF3) building is going to be used to make battery packs.
Now how do we know all of this? Well, we have a source with a proven track record. Among other things, thanks to this source, we reported on project Raven 2 days before Tesla went public with it and reported that the Model Y timeline had been moved up by a few quarters a week before Tesla announced it in their Q3 shareholder report.
Tesla Gigafactory 3 Supply & Ramp Up
Tesla Gigafactory 1 has been supplying battery packs to Gigafactory 3 since the beginning of August. The company has been sending between 400 and 750 battery packs per week depending on what was needed in the Fremont factory at the time. The final shipment for 2019 was sent 2 weeks ago. So, basically 2019 GF3 battery packs were shipped over a period of 12 weeks.
After some fairly simple math, you get a range of 4,800 to 9,000 battery packs that GF3 has in stock at the moment. The median number would be close to ~7,000 battery packs. Technically speaking, that is the maximum number of Model 3s that Gigafactory 3 could theoretically build in the 7 weeks till the end of the year.
Our source has also revealed that GF3 has a very interesting priority, and that is build quality. Even if GF3 doesn’t produce a lot, every Model 3 made needs to come at the same quality level as the ones made in Fremont, or of even higher quality. Due to this, our source believes that Tesla is unlikely to produce more than 3,000 cars in 2019 (but that is no guarantee on production volume).
When you look at the Model 3 production ramp up at Fremont, it was painstakingly slow. It was for all intents and purposes “production hell,” as Elon described it oh so colorfully. Tesla GF3 doesn’t have much more to prove in 2019, so a focus on quality is indeed very possible and commendable.
While I personally hope Tesla will be able to produce more than 3,000 cars, we at least know that they can’t produce more than ~7,000, since that is how many battery packs they have in stock for 2019.
LG Chem’s 2170 Cells
Let’s get back to LG Chem and its batteries for Tesla. These will be basically the same type of 2170 cells that Panasonic produces. LG Chem will do its best to “mimic” the batteries made by Panasonic. The word “mimic” is key here since LG Chem has different manufacturing equipment and techniques than Panasonic, and the cells will clearly be not be identical. Additionally, Tesla determined that the cells made by LG Chem have a slightly lower capacity. For the Model 3 Standard Range, that is not an issue since, as Elon has said before, they can always cram some extra battery cells into the pack to make up the difference. This, however, is not an option for the Model 3 Long Range (LR). Contrary to what Elon has said, our source indicates GF3 will indeed make LR vehicles — it’s just not clear yet when. There are two possible options here: either Tesla is hoping LG Chem will be able to match Panasonic’s capacity at some point, or they will release a LR version of the Model 3 that for all intents and purposes is a Model 3 LR but with a slightly lower range than the Model 3s made in Fremont. Or Tesla might have another “outside-the-
boxbattery solution.” In any case, with sufficient demand, it would make more sense to produce LR and Performance versions locally on each continent. However, when supply and production are constrained, that doesn’t make sense for GF3 right now.
All of this information was first released on our CleanTechnica TV YouTube channel some days ago, as well as some other interesting information not included in this article. To make sure you stay up to date with our YouTube channel, make sure to subscribe and click the bell icon to be notified when we release a new video! To see more, here is the video in question:
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