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Tesla's Request For Panasonic to Speed Up 4680 Cells Reinforces Possible Issues With Them

If Tesla had delivered all the promises it made on Battery Day, it would have started making revolutionary 4680 cells by September 2021 – 12 months after the event. In May 2022, we’re yet to confirm these cells are in any production vehicle, and Tesla is asking Panasonic to speed up the development of its 4680 cells. The truth is that this contradicts all previous plans Tesla presented on September 22, 2020.
Tesla's 4680 Battery CellTesla's 4680 Battery CellPanasonic's  Financial 2021 Fiscal Results presentationTesla Battery DayTesla's 4680 Battery CellMass-sensitive EVs are the ones that willl use the 4680 cells (when they are available)
First, it is vital to check what Panasonic had to say about that. According to Bloomberg, Hirokazu Umeda commented that Tesla asked the Japanese cell manufacturer to accelerate the development process for it to sell its 4680 batteries. Panasonic’s CFO (chief financial officer) also mentioned that he could not say more than what was previously released but that Tesla still had a strong demand for 2170 cells.

Bloomberg got it wrong when it said that these cells would unlock $25,000 EVs. That was never the plan: the 4680 cells were supposed to power the Cybertruck, Semi, Roadster, and other vehicles in need of high-nickel cells. The higher energy density they promised would help “mass-sensitive” vehicles offer more range. The now-suspended $25,000 Teslas was always supposed to use LFP (lithium iron phosphate) batteries.

Regardless of the application, Tesla was supposed to make these 4680 cells independently. Being tabless was something that would allow the manufacturing process to be much quicker. Another technical advantage was the dry-electrode process, which allowed active battery powder material to be directly pressed into a film.

That would increase active-material content in the cathode, make it more robust, and bring conductivity benefits. The EV maker even bought Maxwell Technologies to have the patent for this idea, eventually reselling the company (to UCAP Power) without it. But this is just one of the promises made at Tesla Battery Day.

If the company managed to reach these goals, it could make money licensing this tech to other companies. If Tesla made the “machines that make the machine,” as Elon Musk said it would, it could sell the batteries it did not need for its own cars with the amazing output this equipment would allow Tesla to achieve. None of that happened.

Tesla investors will undoubtedly argue that the company asked Panasonic for a “faster development of the 4680” cells because it needs a massive volume. The question is that words matter. The EV maker is not asking Panasonic to produce them: it is asking the Japanese company to develop them. Whatever Tesla has done until this point is not good enough for Panasonic to just be a sort of manufacturing supplier.

The Cybertruck and the Semi production delays made that pretty evident. These vehicles were conceived around the 4680 cells, and the Cybertruck has more than 1.2 million pre-orders. If Tesla could start selling it, it would have done so a long time ago. It has been beaten by Rivian and Ford to reach that market segment, and there is no perspective for that to happen. Musk’s company promised to get it going by 2023, but it also said it would do so in 2021 and later in 2022. At this point, it is like the production version of FSD and robotaxis.

Panasonic already said that it will not make 4680 cells before 2023. When it does, it will be in Japan. Making these cells in the U.S. will demand another factory, which the Japanese company is yet to decide where to build. According to Bloomberg, Oklahoma and Kansas are the front-runners, and this plant should start its operations around March 2024.

If exporting these 4680 cells from Japan is economically feasible, this may be the reason for the Cybertruck and the Semi to arrive only next year: they may have Panasonic cells, not those Tesla promised to make with dry cathodes and without tabs. The EV maker is clearly not telling everything about these cells. It would not be the first time, right?

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