In our research we have been attempting to ascertain what Tesla’s plans are for its next-generation battery cells. Things are pointing to Maxwell’s dry-cell technology, things are pointing towards solid-state batteries. I have some theories and am still working on an article that sums everything up. Something that totally does not fit into this puzzle, however, are lithium-iron-phosphate (LFP) batteries made by CATL. In fact, if you had asked me what the silliest Tesla battery-related April fool’s joke was that I could have come up with, then it would have been Tesla using lead-acid or LFP batteries to power an automotive product. So, originally, this article started out very skeptically about this news. However, some simple calculations reveal exactly how this fits into the grand scheme of things.
China actually has a complicated history with LFP batteries. For a long time, China heavily subsidized LFP batteries, for electric buses as well as electric cars. China is now re-prioritizing its incentives, which might shift the Chinese market away from LFP. Until now, though, this has made LFP technology the undefeated king within the Chinese market. In 2018, 95% of all electric buses made in China had LFP batteries.
The problem with LFP batteries is that they have a much lower energy density than the NMC/NCA batteries that companies like Tesla use in their electric vehicles. In fact, the technology originally had only a 90–120 Wh/kg battery density. However, thanks to those massive incentives, the technology was developed further, and currently CATL’s LFP batteries have reached capacities like 160 Wh/kg. For comparison, Tesla’s NMC 2170 cells made by Panasonic are somewhere around 247 Wh/kg. [Editor’s note: It appears to me from the table from “Moneyball” in this article that CATL has gotten energy density to >200 Wh/kg.]
It’s funny, Tesla already made a deal with LG Chem to make 2170 cells in China, but those ended up having a lower energy density and is reportedly the reason why Tesla won’t originally make the long range version of the Model 3 and Model Y in China. Tesla simply crams more of these LG Chem cells into a pack to match the range of the international Standard Range versions of the Model 3.
I’ll come back to the rumored use in the Tesla Model 3 Standard Range in a moment.
Stationary Energy Storage
When it comes to creating energy storage products, LFP is a lot cheaper and has a longer lifespan. Think of the Australian Hornsdale battery reserve. You can see that the land around it is completely empty. If you have the space for it, energy storage with LFP batteries for a lower price could be a very lucrative option.
However, it’s possible that LFP could work for the standard range Model 3. Read on.
CATL Cell-to-Pack Technology
Until now, battery cells were first put into modules and then put into packs. Both CATL and Tesla have decided that they want to get rid of the modules and place the cells into packs directly. CATL has already done so and calls it cell-to-pack technology. While information about this is scarce, the company claims that this can increase energy density by 10–15% and improve volume utilization by 15–20%. In total, it can reportedly reduce the parts needed for the battery packs by 40%.
Elon recently said that modules were part of the original Tesla Roadster design, and because the pack and module design teams were separate teams, the use of modules persisted. They were also used in the Model 3 battery pack design, but Elon and team realized they could actually ditch modules going forward thanks in part to improvements in cells. Tesla has since merged the module and pack teams and hopes to put cells directly into modules. The notion that CATL would share this technology with Tesla seems almost absurd considering that CATL holds over 70 patents for the tech. Tesla doesn’t need CATL to help them design better packs nor do I really think CATL would provide that help to a company that could sooner or later become its biggest competitor — it doesn’t really make sense.
Unnamed Reuters Source
The first reaction I had to the news was, this must be a hoax. However, Reuters must trust this source implicitly to write the article as boldly as it did. The article says this person is “directly involved in the matter,” but does not mention on which side the information comes from. The article also says that these LFP batteries will be cheaper than Tesla’s current batteries by a “double-digit percent.” So, all we know is that it is more than 9% cheaper but less than 100% cheaper.
The Calculations Fit Like a Glove
Technically speaking, if you added 35% more 160 Wh/kg LFP cells to the Model 3 Standard Range’s battery pack, you would reach the 50 kWh needed. There is space for 32.6% more cells, so the numbers are already close. If Tesla did get rid of the modules and had more space, it could indeed fit enough LFP cells into the pack to get the same range as the current Model 3 Standard Range. If the CATL cells are actually 180 Wh/kg, then Tesla would not even have to change the pack design. [Editor’s note: Again, it appears to me from the table from “Moneyball” in this article that CATL has gotten energy density to >200 Wh/kg, unless I’m misunderstanding something.]
Side note: Just because CATL had 40% more room in the pack for cells doesn’t mean that Tesla will also see a 40% increase. Its packs might have already been better than CATL’s, in which case we would not see as much of an improvement.
100 kWh Tesla Model 3
If Tesla is about to make packs with no modules, and fills those with its current Panasonic batteries to the brim, this could explain rumors about the 100 kWh Model 3. If Tesla has even 25% more space in its packs, then Tesla can suddenly make a 100 kWh Model 3. In fact, in December some of Tesla’s code was leaked by a Tesla hacker known as Green.
Now where it gets interesting is with the actual batetery packs.
the 100kWh pack has survived the great "non-model3 stuff purge" mid year so there's a fair chance this is actually upcoming and not some spillover. pic.twitter.com/gliPuJhrP7
— green (@greentheonly) December 20, 2019
This is not a much anticipated Tesla next-generation battery. In fact, this may indicate that the next-generation battery is further away than we previously thought, but not necessarily — I will get back to that in a moment. Will Tesla unveil its homemade next-generation battery cell during battery investor day in April? I think it will. At the same time, Tesla will likely also announce that this new battery pack without modules will replace the existing battery packs.
Now, the real question remains — if Tesla can squeeze 40% more batteries into the same pack, is that enough to explain the range of the Tesla Semi and new Roadster? Answering this question might shed light on how soon Tesla’s next-gen batteries will arrive. To get an answer to that question and many more about the state of Tesla’s next-gen batteries, keep an eye out for my upcoming article. 3 new pieces of the puzzle were unraveled within the last week alone — one in Fremont, one in Denver, and this one in China.
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