May 11, 2016
austinEV On the question of battery capacity, here is my gut feel: Panasonic is ramping much faster than anyone, including musk thought.
Think about it. At the time that TM came along to save them, the bottom had dropped out of the laptop market and they had zero reason to worry about capacity, efficiency, density etc. for many years. TM has been buying up Panasonics capacity and asking for more. Panasonic being conservative, wouldn't commit to crazy hockey stick capacity, so TM strong-armed Panasonic into partnering with them on the GF, they said yes having little choice.
So TM breaks ground on the Sparks factory, and Panasonic quietly says to it's own people: Maximize output. Those projects you wanted a few million USD on that we couldn't afford before, now we can-- go get it done. Capacity goes up, energy density goes up, prices come down. Panasonic threatens TM: you have to take all we produce, so TM starts Tesla Energy to soak up any and all extra production, further emboldening Panasonic to maximize output.
Panasonic batteries stack up in sparks. Elon realizes that with or without the GF output they can actually ramp the M3 and publicly makes it a goal.
I too sense a lack of urgency on the GF from Elon. I think it is more a necessary in 2019 sort of thing, and they are prioritizing it accordingly. The cheapest assets in play are Panasonic's slack capacity.
If it IS an adjustment of priorities like that, it is the right thing to do for everyone involved but not something they would necessarily want to admit publicly without it sounding like they were walking back production commitments.
Similarly Panasonic was probably never totally honest with TM. If they had loads of slack capacity they wouldn't want to admit that to TM or put themselves in a weaker bargaining position. Even *panasonic* may not have known their capacity for internal face-saving reasons.
So the GF may have been an unintentional stone-soup incident where Panasonic suddenly discovers it can in fact meet a much higher production at 30% reduced cost.
/shrug fiction maybe.�
May 11, 2016
JRP3 Very insightful summary. I wouldn't be surprised if some version of that is close to what happened.�
May 11, 2016
doctoxics I have no basis to refute your scenario. All along it has seemed to me that Panasonic has been the reluctant partner. After Elon locked up Panasonic's Osaka production, even requiring them to reopen closed factories to meet the Tesla demand, Panasonic seemed reluctant to invest in Gigafactory1. This may have been a result of the licking they took on consumer electronics, from which they had just extricated themselves. Then we have the change in Gigafactory1 ramp, which I had assumed was more Panasonic's choice (incremental ramp of battery production) than Tesla's.
Elon and Kazuhiro Tsuga (CEO of Panasonic) have a close relationship (environmental and business interests) as do the battery units of both companies. I don't think there are any secrets. The relationship has always seemed to be mutually beneficial. Do we have any evidence to the contrary?�
May 13, 2016
schonelucht The negative implication being that Tesla no longer has a competitive advantage on price for battery cells wrt its competitors, should it turn out that a gigafactory isn't necessary to drive down prices with the targeted 30%.�
May 13, 2016
electracity Many battery companies have always been capable of meeting automobile demand. No one would take the credit risk on little Tesla for a huge battery order. Tesla perhaps even faced the possibility of rising battery prices with surging demand.
Not a single cell has been produced in the gigafactory. It's a construct, a new paradigm, that got many companies busy thinking about making and using batteries. If Panasonic has now decided it wants to meet demand from Japan for a few years, it doesn't matter. Tesla needs adequate battery quantities at a competitive price.
Tesla is investing in Panasonic every bit as much as Panasonic is investing in Tesla. Tesla is bring capital into battery making which allowed Panasonic to justifying scaling their production.�
May 13, 2016
austinEV It is totally positive. TM never really wanted to spend a bunch on a battery factory; they would have preferred to buy excellent batteries at low cost. If Panasonic has provided a "shadow" GF ahead of the actual GF opening, all the better. The real GF will still open and provide even more capacity to grow.
As for competition, maybe no one else is as good as Panasonic. Also, the more the merrier, EV's compete with the total car market, not just other EV's.�
May 13, 2016
electracity But I don't think Tesla/Panasonic is just going to build bigger cylinders in Nevada. I expect major simplification in EV pack production. I think they re-configured the building when they finalized the new processes.
As I have said before, just making larger cylinder cells in Nevada doesn't seem to be enough innovation.�
May 17, 2016
JRP3 Local perspective on the GF Storey County, Nevada ****ing Loves the Gigafactory�
May 17, 2016
tftf Which one is it if this article is true...
Tesla approaches LG, Samsung for Model 3 batteries
Strategies:
A) A giant battery plant for $5 bn and 6500 local employees - and "unique vertical integration benefits" (cutting costs by 30-40% according to Tesla)?
B) Buy batteries (or at least cells) on the open market from Asian suppliers - as the rest of the car industry does (most of them have signed with LG Chem already in 2012-2015) ?
How will Tesla get better pricing than its competitors in case of B) - and why build a giant Gigafactory in the first place if Tesla buys (at least a significant portion of) their cells from Asian suppliers?�
May 17, 2016
tftf We will see how much of the GF gets built in case Tesla looks for additional battery suppliers (see links above). Maybe Panasonic is not that interested in investing more - at least not for now?
Oh, I get the concept of ramping. But it doesn't fit the new "2018 ramp strategy for 500k cars" timeline - in fact it goes counter.
Tesla would need to accelerate building the GF - so far Tesla and Panasonic only spent 10% of the projected $5bn on the project.
They would have to spend much more/faster by 2018 - instead of 2020.
Instead they stopped building additional sections back in spring 2015, they even removed sections under construction - many photos prove that (see section 5 in the pictures):
The differences from Feb 2015 to May 2015 (steel frames removed) are obvious.
Why didn't they (at the very least) restart the day they got all these Model3 reservations?
PS: And once again: If Tesla buys cells on the open market by 2017/2018 to have enough supply for the Model3 where are the promised "30-40% cost advantages" over the competition?�
![[?IMG]](https://staticseekingalpha.a.ssl.fastly.net/uploads/2016/2/18/5760541-14558084580528393_origin.jpg)
May 17, 2016
techmaven That article is content light. All it really says is that Tesla visited these companies. There was nothing said about buying batteries like everyone else. We don't know it has anything to do with Model 3. If it even is Model 3, we don't know that it is for Model 3 production wrt Gigafactory 1. It might be a joint effort for Gigafactory 2 or 3 somewhere else in the world. That article is so devoid of content that it is nearly useless for establishing anything.
As for removing the extra frames, Tesla reconfigured the first phase and added a floor to the first phase. This is already well known. It altered the construction plans for the 2nd phase since the 1st phase is now much bigger.
On a side note, you seem to be having a hard time modeling a project through time. Have you never actually built anything? Managed any kind of project? I've already answered you here:
Tesla Gigafactory Investor Thread
It's one thing to lie to others, but at least don't lie to yourself or be the ultimate fool. At this point, you are no better than Avenger tilting at the Fukuta motor supply windmill.�
May 17, 2016
JRP3 No evidence that it is, but of course, run with it...�
May 17, 2016
tftf We will see when these 500k cars and batteries actually ship.
The main issue with Tesla's "impossible" 2018 goals: Employees aren't dumb.
They'll see Musk crying wolf again and again and begin to ignore those impossible deadlines / tasks (more churn, more people getting fired or leaving - which results in more delays).�
May 17, 2016
dakh AFAIR they publicly stated a while ago that they figured a way to produce more cells using less floor space which would perfectly explain what happened on the ground. They simply didn't need the space they planned for due to equipment/design improvements they came up with after the initial building plan was done.�
May 17, 2016
hirox Tesla have been talking with other suppliers for years.
relevant: Samsung SDI to supply more batteries to Tesla�
May 18, 2016
tftf I heard of the magic floor a long time ago.
That doesn't change the total floor space (Tesla was rightfully quoting that number for a long time, not the building size - so far they are at just 14% of the total, that's their number, not mine).
Also, the total investment numbers submitted to Nevada (Panasonic and Tesla combined) clearly say how little they invested so far.
$500 million PTD investment simply doesn't build the largest battery factory in the world - not on one floor, not on two floors and not on three.
There's also no news on sub-suppliers investing as of Q2 2016 (these names were once promised for 2014 and then 2015).
Tesla and Panasonic should add new structures in parallel 24/7 in Nevada to make the 2018 output numbers. So far I see no activity.
I doubt all of the involved parties will invest more than another $500 million in the existing building structure (machinery etc.), probably much less.
Even assuming a very optimistic $1bn PTD until 2018 doesn't build the largest battery plant in the world.�
May 18, 2016
techmaven In your world, adding floor space doesn't add floor space? Nothing magical. Did you not bother to listen to the Storey County exec?
Maybe because it isn't done?
They don't need to start on phase 2 until later this year. Somehow you keep needing them to spent more money and faster than they do... hmm, I guess that short thesis is pulling you like gravity towards that.
Based on your expert hunches? Right? Do you have anything more than that? The investment schedule for the pilot phase is for around $900 million - $1 billion PTD this year. Tesla only needs to add another $50-100 million. Panasonic adds another $350-400 million. As I mentioned before, you can now see Panasonic's investment start to ramp up.
Again, when does the last phase need to start in order to hit production in 2020 in your mind? I say mid 2019. When does the 2nd to last phase need to start in order to hit production in 2020? I say late 2018.
By the way, just to make the largest advanced lithium ion battery plant in the world, they might only need one phase if the pilot plant is bigger than Suminoe. It'll be close. Definitely when the first line of the 2nd phase is up, then the Gigafactory is already the biggest, even without a fully operational 2nd phase.�
May 18, 2016
Gerardf Wel all know you doubt all that. You keep repeating the same again and again and again and again.. There is noone here who has not at least twice seen these same points you keep bringing up. And it is virtually all speculation. You add nothing new to this discussion doing that.
It is fine for you to have all these doubts. Don't buy the share, go short (you probably are already). Also fine if you have something new to bring it up for discussion. But stick to one time, please stop repeating the same things over and over.
It is also perfectly fine of course that the current shareholders do not share your level of doubts( SP is proof). Neither do the people in charge in Nevada, they are happy with Tesla GigaFactory progress. Also Tesla mangement keep repeating that GigaFactory-1 is ahead of schedule, who are you to think you know better.
You might now move to repeat all your 'proof' that Tesla managment is always lying, As you also do in other threads, and again you will not have any proven fact. So please save us your libel this time. It is not working here.�
May 18, 2016
austinEV Here is my take on the GF: We simply don't have enough information. We project our biases on it. Frankly I have never been overly convinced by the Bullish case on GF progress, but it is no worse than the Bear case.
To me it feels like what we observe is explainable by a large range of possibilities, from "Tesla is Sh****ing the bed" to "Tesla is doing better than forecasted". We simply don't know. Its like arguing over tea leaves. I have the same feeling about arguing over the true capacity of Fremont. We simply don't know. So if you are inclined to think the worst, you make that case. If you are inclined to the think the best you make that case.�
May 18, 2016
AudubonB Moderator's Note:
Far too much prodding and provoking occurring in the prior dozen or so posts. The worst offenses have been cut but the overall tenor of the discussion is both unproductive as well as demeaning to most of the current authors. Certain of you received explanations but were truncated from what I intended to say -
the overall gist is that it is hard for others to think of yourselves as smart when you don't seem to realize it's never smart to get into a certain kind of match with a skunk.�
May 18, 2016
Johan $2 billion cap raise might buy some square feet, be it on the first or second floor?�
May 18, 2016
electracity http://seekingalpha.com/article/3975977-panasonic-explains-tesla-seeking-alternative-battery-suppliers�
May 18, 2016
Familial Rhino It's not $2 billion, it's $1.4 billion.�
May 18, 2016
Johan Right. Unless Elon wants to put some of his personal wealth toward a penthouse on top of the magical second floor.�
May 18, 2016
techmaven As usual, Mr. Santos almost has it all, but misses in the conclusion because he has to figure out how to turn positive into negative.
Look at the actual statements....
"Sales to Tesla didn't grow as much as expected � Model X number was not sufficient in terms of production. Rather difficult situation"
Yeah, we all already know this.
"Over the longer term, Tesla's Model 3 orders should be larger than we were originally expecting... To the extent that we can supply them ahead of schedule, we are coordinating our efforts with Tesla to see what things we can do to make it happen."
Positive.
wrt FY2018, "Investments into that Gigafactory, we don't know at what timing we'll make that payment�" Panasonic says it expects the payment to be made earlier than expected, but it doesn't yet know when.
More positive.
Mr. Santos still seems to try to perpetuate the idea that the entire Gigafactory is necessary for the 30% cost savings. That's not what Tesla says. Instead, a single phase is enough.
�
May 18, 2016
electracity Tesla could make drive components in addition to battery packs at the gigafactory. They are planned to ship to Fremont anyways. Nevada doesn't care what is made in Storey County, as long as there are jobs.
Gigafactory could ship to Fremont as well as a future east coast factory.�
May 22, 2016
Cattledog Heard at conference over the weekend from construction supplier, Gigafactory will be 8.5M SF and complete 2020. The 8.5M is new to me, original projections were 10M SF.�
May 23, 2016
Rarity Over the last month, gigafactory hiring seems to have continued at a good clip -- a ~17% increase in gigafactory employment. According to LinkedIn, Tesla is employing at least 122. Compare to official Nevada state number of 317 as of March 31.
Panasonic has not increased its headcount. Currently, according to LinkedIn, Panasonic has 25 employees in the area (not all of whom work at the gigafactory). Compare to official Nevada state number of 52 as of March 31.
�
May 23, 2016
Rarity I'm not convinced that even Tesla knows where it will all end.�
May 23, 2016
Johan Could it be that they're talking ground footprint area? It seems they changed the building design underway by adding a second level which might mean the same, or even higher total floor area, but a somewhat reduced footprint on the ground level?�
May 23, 2016
neroden Santos is so wrong it's not funny. I went and listened to the linked (English translation) of the Panasonic meeting, and they say "We are also building capacity for rectangular cells at D______" (a location name I couldn't identify) to sell into the storage market and also other markets. This makes it clear that this is a separate project totally unrelated to Tesla (it's at a location which has nothing to do with Tesla) but the idiot Santos thinks, and claims to his readers, that this has something to do with Tesla.
He really is misleading people by gross dishonesty to the point of selectively omitting words from quotes, and I kind of expect someone to sue him and Seeking Alpha over it eventualy.
There are interesting implications in the Pansonic conference call. They are shy of investing on Tesla's behalf preemptively, so they are probably shy of speculative factory investment in general But they are building rectangular cells for the storage market. I am suspicious they are building them for an undisclosed client who is trying to compete in the storage market -- I wonder who it is?
I would be worth doing a rundown of potential storage-battery competitors again to see who might be ordering custom rectangular cells from Panasonic, but I can't be bothered at the moment.�
May 23, 2016
Sudre I would expect battery manufacturers in Asian countries to build battery packs for Tesla's built in Asian countries.
I would expect battery factories in North America to build battery packs for cars in North America.
I would even hazard to guess the battery factories in the EU will make batteries for electric car sold in the EU.
I don't think Lithium battery manufacturing is has pollution intensives like refining oil into gas so there is no need to keep the battery factories far away like refineries.
Seems logical that the Tesla Gigafactory in the US and expanded factories from Panosonic are going to be required to produce the 1 million world wide Tesla vehicles which Elon hopes to create. I think there is a much bigger picture than some are seeing.
Tesla would be foolish not to talk to all suppliers just in case demand is really heavy like.... well you know... The Model S when it first hit the streets. If I recall there was a battery shortage for a short bit.�
May 24, 2016
Model 3 I thought that competitor was Panasonic?�
May 24, 2016
schonelucht Possibly no, but the premise of the Gigafactory is that there is a huge scaling benefit in battery factories which makes the case for one huge centralized production instead.�
May 24, 2016
electracity I think the gigafactory has turned into an interesting mystery. Tesla may not tell us the basics until the model 3 is released. Obviously something changed, and they are not just duplicating an existing panasonic cell factory.�
May 26, 2016
neroden Ha, you are probably exactly right. I didn't think of that!�
May 27, 2016
9837264723849 I think I missed something. What makes you question the initial plan? What seem to have changed, why not a mere cell+pack factory with recycling capabities?�
May 27, 2016
Reeler 
�
May 27, 2016
electracity They altered plans to build a pilot plant, including removing a section of steel. Clearly they did not pursue their initial plan.
Panasonic doesn't need a pilot plant to build cylinder cells at the gigafactory. My guess is that that Tesla is working on pack building processes that are as cell agnostic as possible. This is an area where Tesla can make new IP. Panasonic could also be producing a unique/modified cell type that is less expensive but still can be cooled adequately to allow a low C rate.
There is a Tesla space and a Panasonic space in the gigafactory. It seems somewhat unlikely to me that Tesla is adding processes engineering to front end the panasonic cell building process. It seems more likely that the Tesla is only on the back end, building stuff from cells.
Tesla needed less expensive cells, so they formed the gigafactory. Since that time, cell prices have dropped significantly faster than expected. Is Tesla still pursuing even cheaper cells, or have they altered their strategy? With cheaper than expected cells available, Tesla's primary need is probably to de-risk cells.
Edit: Also, by plan they need about 25 gwh of packs for the M3 in 2018. That is half the original capacity of the GF. One way to do 25 gwh in the space they will have built is to eliminate the raw material processing on site.�
May 27, 2016
tftf It's not just about space (but even on the floor space level, Tesla is at just 14% of the planned size), but also total investments to achieve the needed GWh.
Equipment costs are the same worldwide. As we know: So far (end of Q1 2016), Panasonic and Tesla combined only invested $500 million - even if they add another $500 million after the "grand opening" of the pilot plant within the existing structure that amounts to only 20% of the initial projection of $5 billion.
In comparison:
- Daimler is investing around $600 million for a mere battery pack factory expansion in Germany (importing all the finished cells from Asia, therefore this plant much simpler/cheaper in terms of machinery/tooling). See my older posts in this thread for details.
- VW is rumored to invest up to 10 billion EUR if they go ahead with a fully integrated battery plant in Germany. German source via dpa:
Zehn-Milliarden-Euro-Investition f�r Elektroautos: Volkswagen erw�gt Bau gigantischer Batteriefabrik in Salzgitter
Tesla and Panasonic will have to invest billions more over the coming years to make the current pilot plant into a Gigafactory at the projected output levels.�
May 27, 2016
electracity If Tesla has a less capital intensive way to get cheap batteries for 500,000 cars, great. We don't know what capital investment Panasonic is making elsewhere to supply Tesla. Making batteries this year for 80K cars plus Tesla Energy is a lot of capital investment for Panasonic.
I also don't see how Tesla makes 25gwh of batteries in Nevada in 2018, but this does not bother me. Since I think making 500,000 EV battery packs in 2018 is a big challenge, I think this is their focus.
Oddly, the acceleration of M3 production may have resulted in planning for fewer cells to be manufactured at the gigafactory in 2018.�
May 27, 2016
tftf Well, how does this change of strategy add up financially? That's my old question.
Tesla kept advertising to investors how the unique scale of the "original" (100% built) Gigafactory (including recycling and direct access to raw materials and having all battery component sub-suppliers in one space etc.) will bring down battery pricing by 30-40%.
(Never mind they used old 2013 battery prices from competitors as comparisons, as if all the other battery suppliers would stand still and make no progress on their chemistry, factories and pricing between 2013-2020).
- So will the much smaller pilot plant (at 14% of the original scale) also lower prices by 30% or more?
- If not, how can they sell an M3 car at $35k base pricing by late 2017 (battery pack will still be among highest component cost in the vehicle) ?
- If not, why plan this giant factory in the first place instead of importing cells from Panasonic Japan as before (and upgrading the facilities there for new chemistry / larger cylindrical form factors...)?�
May 27, 2016
techmaven Of course, they are going to spend more money. They already announced that way back when they announced the Gigafactory in the first place. As for spending more than they projected, again, Panasonic spent roughly $1.1 billon to build the existing Suminoe Plant in Osaka, Japan that builds cells for the Model S and X. It's roughly 7 GWh. It is far cheaper to build in Nevada than Osaka, Japan and Tesla/Panasonic already know where they are saving more costs. So why would it be substantially more money? If the Germans overspend, that's their problem.
However, now Tesla's approach to owning battery factories has been validated since VW is seriously considering this plan. They've praised Tesla recently, saying that Tesla did all the right things. Clearly, any serious industry watcher knows that the big automakers have to invest up front money in battery production in order to stay relevant. Tesla is ahead of the curve, as usual, and it takes a while for others to understand, much less take action. If they are only spending $10 billion over the next 9 years, that's not a good thing for VW.�
May 27, 2016
techmaven Pilot phase of the Gigafactory already brings the price down 30%. Additional scale necessary to ship more cars, not to achieve price reduction. The comparison isn't against other car companies or other battery manufacturers, it's against their own battery pack pricing. The improvements are not only at the cell level. They've said this over and over from the very beginning.
Of course, Tesla didn't have a choice in building first... they had to ship product first which meant buying from Panasonic. And Panasonic has been updating chemistry. And likely, Panasonic will update the lines at some point, especially as the Gigafactory phases come online and production disruptions can be scheduled in for such upgrades. Tesla has already updated the Model S battery pack design once and will likely do so again when it makes sense.�
May 27, 2016
tftf Nissan spent billions on three large battery plants (located in Japan, Europe/UK and the U.S.) well before Tesla even started talking about a Gigafactory - including recycling and using spent EV batteries for ESS / local energy buffering later on.
It's not a "new" plan or strategy validation by Tesla to bring down costs or secure supply:
Nissan's New US Battery Plant Shows Major Dedication To EVs - HybridCars.com
(this is just a portrait of one of the three plants)
5 Facts About Nissan�s Battery Manufacturing Plant - The Equation
Nissan and Eaton power ahead with second-life battery system - Automotive World�
May 27, 2016
electracity Don't ask me. I don't believe that the gigafactory will produce cells at a substantially lower cost cells than competitors working at the same scale. Panasonic, LG and Samsung are not stupid.
Musk is going to concentrate resources in areas where Tesla can gain significant competitive advantage. Wooing Panasonic to Nevada makes sense. Competing in the near-commodity business of high volume cell manufacturing may not make sense. Better to have the battery manufacturers provide most of the capital and pay for the capital by purchasing cells.
Tesla will likely profits most by concentrating capital in car building, not cell building. The gigafactory strategy was forced on Tesla by the reality of battery availability and cost. To the extent that conditions have changed, Tesla should adopt.�
May 27, 2016
Johan The 14% drivel is getting old. Forget all those old numbers. Things change quickly with Tesla.�
May 27, 2016
tftf The 14% is already adjusted to the revised floor layout (not just the old footprint) of the Gigafactory.
But let's assume this changed again (we have no sources for that, otherwise please show me links...) - even so, the invested numbers don't lie.
You simply can't build the "largest battery factory in the world" for $ 500 million or even $ 1 billion - that's why Tesla/Panasonic talked about $ 5 BILLION for the full Gigafactory and VW is talking about 10 BILLION EUR for their huge battery project (according to educated sources in Germany):
VW plant offenbar Batteriefabrik in Salzgitter
2018 is just two years away. We will see how many cells Tesla can actually pump out per year with the current structure and at just up to 20% (if we assume around $1 billion in PTD investment until 2018, so another $ 500 million over the coming quarters) of projected total cap-ex.�
May 27, 2016
techmaven What exactly do you think VW will be doing by 2018?
Gigafactory will likely have around $3 billion invested by the end of 2018, and very important, already have a significant revenue stream that will help pay for the rest of the investment.�
May 27, 2016
CButterK IMHO, VW needed to show good faith publicity as part of damage control to win back Customer confidence to purchase ICE products for now, as they try to bridge the gap with announced PHEVs for next several years, then BEV by 2020. My guess is, VW won't have a functioning Gigafactory(not even 14%,) until 2020+
�
May 27, 2016
JRP3 Since Tesla has stated higher end models will be selling first it's quite likely they won't be selling any M3's at $35K until well into 2018.�
May 27, 2016
JRP3 I see, so the GF was a really bad idea for Tesla but other large battery plants by other companies are really good ideas. Got it.�
May 27, 2016
tftf Where did I say that it was a really good idea?
If you had read a few of my older comments or blog entries on the topic for the past 2+ years - or read Nissan's annual reports - you would have noticed that Nissan lost / wrote down a few billion USD on this vertical integration strategy in EVs so far.
I was just pointing out that vertical integration and secondary use / recycling of EV batteries has been tried well before Tesla announced their Gigafactory or storage plans.
The alliance now leads EVs globally with Renault-Nissan (and even more so thanks to the new 30% Mitsubishi Motors stake), but was all the vertical integration cap-ex worth it (especially since they are likely switching partners from NEC to LG and vertical integration makes it harder to switch battery technology partners...)?
Vertical integration in battery supply is a necessity to some degree, not an advantage.
Like DRAM or solar panels, this field is full of technology gaps and "pork cycles" for the next 1-2 decades, very low margins can be anticipated.
Just look at the history of DRAM, flash storage and solar panel makers over the past decades to get an idea where cell manufacturing is headed.
I don't know what VW will do (and I don't own any VW shares). They will announce their 2025 strategy in a few weeks:
�berblick: Die wichtigsten Themen f�r Volkswagens "Strategie 2025" - manager magazin
It doesn't take too many crystal balls to see which areas they will likely focus on:
That's where every major car maker is investing in long-term.
- Autonomous driving R&D
- Digital / Connected cars (along with new business models, see their recent investment in GETT: VW invests $300M in Uber rival Gett in new ride-sharing partnership )
- More Electrified vehicles
The last bullet point could involve announcing a large battery factory in Europe (at least later on, maybe in a JV structure, who knows...).
As for 2018? They will likely still buy their battery cells from large Asian suppliers.
Regarding your $3 billion prediction until 2018, that will involve Tesla raising a lot more capital by CY 2017 (even if Panasonic shoulders its parts of the investments going forward).�
May 27, 2016
techmaven Incremental amount for Tesla is about $800 million to $1 billion. Tesla doesn't have to raise a lot more capital for that.�
May 27, 2016
Gerardf Hej tftf, I actually think you are on to something !
Wouldn't it be great if VW announces a JV in Europe with Tesla for GigaFactory-2. Crazy enough, it all fits.
- in a few weeks VW announces their plans
- Tesla delayed GF party a few weeks
I would be SO curious to your reaction if it would be announced in a few weeks by VW and Tesla that GF-2 will be in Germany and is a JV between Tesla, VW and another partner like LG or Panasonic or Samsung. GigaFactory as a product.. Im Salzgitter.�
May 28, 2016
Gerardf Disclaimer : extreme speculation for the fun of it. But hey, it is weekend.
Actually, the more I though about the above..... It is crazy enough for Musk to do, and one can see the many win-win elements in it.
It is very, very unlikely as VW is probably will be too much of a dinosaur and too afraid of Tesla's success to condider it. Just like noone took Tesla up on the offer to use the SuperCharger network....
Some of the win-win's :
- In line with Tesla's vision to "accelerate the advent of sustainable transport"
- In line with Tesla vision that more EV competition is not a danger but a means to execute that vision.
- VW gets the experience and know-how and access to low � / kWh battery packs, derisking this major and complex project.
- VW will not depend on others to secure availabily and stable pricing for the packs.
- VW can profit from large scale while their own need for batteries still has to ramp up.
- VW goodwill, negotiation position to lower exhaust fraud penalty. This alone can actually pay for VW's part.
- VW jumps ahead of Toyota, GM, Ford, etc, etc in the switch to sustainable clean technolgy.
- Tesla gets a big partner for a European GigaFactory, securing financing and stable pack pricing in the Eurozone.
- Tesla gets the extra battery capacity they will need in 2018-2023.
- Tesla's BEV vision is (again) confirmed and no longer up for discussion, for even the most die-hard fossile fuel fans.
- GigaFactory as a product.
- VW has then option in this deal to sign in, at favorable conditions, for SuperCharger access for the new VW BEV's.
Remeber Elon officially requested for VW not to get a hughe fine, but should be forced to EV investments instead.
Crazy and very, very unlikely.. Sounds to me like a crazy enough challenge for Mr. Musk to consider
P.S. Also a win for us shareholders. Short sqeeze of epic (ludicrous !) proportions day after announcement
P.p.s tftf, shoot me down as a crazy uber bull.. But your posts from the Hop-Sing laundry were the trigger for these thoughts.�
May 28, 2016
Johan But what on earth are we discussing here? Is your premise that Tesla + Panasonic won't invest the ~5 billion? Or do you live in some parallel universe where all of a sudden they've claimed they'll build the entire thing for just 0.5-1 billion???
It really is tiresome with these straw man arguments.�
May 29, 2016
tftf 1. Tesla doesn't have the money to invest their remaining chunk of the $5bn rapidly (even after the latest capital round). The other question is if they (that includes Panasonic) really want to build the GF to its projected size even if they have/had the funds.
2. The parallel universe is Tesla claiming to build 500k cars (and batteries) by 2018 - and storage batteries on top of that! - given the small investments so far and the limited size of the pilot plant.
2018 isn't far away. We will soon see...
- how much more Tesla raises until then (I see another huge capital round coming in CY 2017, the Model3 will also require lots of cap-ex)
- how many cells and batteries they will produce 18-24 months from today given that there is no activity yet on phase 2, 3 etc. in Nevada.
- what the actual pricing advantage is over other battery suppliers (again, it doesn't make sense to claim a 30+% cost advantage using old 2010-2013 figures, LG and Samsung don't stand still until 2018-2020).�
May 29, 2016
dc_h Tftf really points out that EV's can't lose. Prices of batteries have, he says, already fallen too much to expect 30% cost reduction. If he's right, good for Tesla, if he's wrong better for Tesla. Either way he is arguing that EV prices are declining rapidly, which means they will win the ICE war. Without burrowing through Excel sheets I don't think we can know, but Elon and JB still believe and we will see if phase 2 has begun on July 29th, or when it will begin.�
May 29, 2016
dhanson865 wouldn't the implication be that they have even more than expected ability to reduce costs?
A. Tesla says high capacity of the Gigafactory can drop costs by 30%
B. Panasonic increases cell technology and reduces prices with existing plants
A + B = C Tesla uses Panasonics improvements with the expansion of the gigafactory and make the cost drop more than the previously expected 30% with lower start up costs because Panasonic reduced the need to pay higher construction costs for expediting.�
May 29, 2016
doctoxics
Article reports Tesla executive recently said battery pack costs will now be reduced 50 % at Gigafactory1 rather than the previous estimate of 30 %.
Tesla President reveals key insight into company forecasts; Gigafactory will cut battery costs in half [Video]�
May 29, 2016
Oil4AsphaultOnly Mr. McNeil seems to be a good candidate for COO (and possibly next in line to be CEO). As much as I like JB, he's not yet seasoned enough as an executive. Larry Page did the right thing for Google, when he stepped aside to let Eric Schmidt lead for a while. JB will get his chance, but not in time to replace Musk after the model 3.�
May 29, 2016
Fallenone The 30% comes from vertical integration. More would be from scale of economy. So the 50% total isn't really new target IMO.�
May 30, 2016
electracity I doubt Musk leaves the CEO job. He can step back from implementation details and still remain CEO. I doubt SpaceX has enough evolving product features to hold his interest as his primary job. Tesla won't be "safe" as a company for many years.
I'm unclear if he was talking about battery pack improvements in the Model X or the gigafactory.�
May 30, 2016
Oil4AsphaultOnly You got his words mixed up. He said that he'd still be with Tesla, just not as CEO. Just need to find a transcript of the Q3/Q4 conference call somewhere.
Edit: Addendum: Mars, and thus SpaceX, is his ultimate goal. He was originally involved in Tesla only as a source of start-up funds. It wasn't until he needed to kick Martin E. out did he take over as CEO. No such abiguity with SpaceX.�
May 30, 2016
Oil4AsphaultOnly This was the original biography of Musk, before Ashley Vance's book: The Engineer�
May 30, 2016
Krugerrand SpaceX is closest to his heart. He never wanted to be CEO of Tesla, he did that out of necessity. He plans on dying on Mars so there's no doubt it'll hold his interest for the rest of his life. If he felt he could, he'd do that as his primary job instead of splitting the vast majority of his time between that and Tesla.
Initially he said he'd stay at Tesla to see Model 3 through to mass production, then he'd leave it (mostly) in someone else's capable hands but still be involved/keep an eye on things. That has changed a bit and he's made a number of subtle and not so subtle hints and statements that suggest he's changed/thinking about changing his mind, like references to making it a family owned and run company like Ford.
The idea of him remaining CEO, yet stepping back from implementation details: ahahahahahahahahaha.�
May 30, 2016
neroden One of the problems with statements like this is that they never say what the reduction is *relative to*. 30% reduction relative to what price? Clearly their production cost in 2013, which they never published.
Likewise, 50% reduction relative to what price? The 2013 price? The production price last year? The $190/kwh price quoted a few weeks ago?
The vagueness means that I haven't been able to interpret these statements as meaning more than "yes, we will cut costs by using the Gigafactory".�
May 31, 2016
Gerardf Ok tftf, it is now official. That 14% you keep repeating is actually 3x 14% = 42% of inital plan.
So please spare us your 14% babble from now on, not just here but on any forum on the internet that you keep repeating this.�
May 31, 2016
tftf The 14% is about the floor space and that revised number (more floors etc.) has been known for months:
1.8 to 1.9 million sq ft out of a total of 13.6 million sq ft of operational space. 14%.
Source from Nov 2015: Elon Musk Powers Up: Inside Tesla's $5 Billion Gigafactory
Maybe they revised that number upwards again in the meantime? Plans are cheap, execution is not.
In the end it's all about actual money invested. Battery manufacturing for current cells is well understood, equipment has its price. If you believe Tesla (and Panasonic) can magically produce 50, 100 or 150 GWh worth of cells and batteries a year soon without first investing billions more into the factory, then do so.
PS: This is similar to Musk talking about the Fremont factory 'potentially' producing up to 1 million (compare that number to what NUMMI produced on the site in its heydays, about half that output!) cars a year. Also note how Musk and other Tesla execs never talk in details about the additional cap-ex needed to get there one day...�
May 31, 2016
Johan Hmm.... In fact it's 14%^2. Elon doesn't think floor surface area but factory volume in 3 dimensions.
(Yes I understand that 0.14 squared is much lower and I'm just pulling the Future's leg here)�
May 31, 2016
tftf That's the magic of it, isn't it? Believe, don't ask too many questions.
Instead Tesla prefers talking about what 'could' be. Like feeding the press with numbers of 1 million cars produced a year out of California or a gigantic $5billion battery factory with 13+ million sq ft - when the current output and cap-ex is magnitudes smaller.
Whenever someone asks for more details on financing and keeping the overly ambitious timeline projections, there are usually only evasive answers on conference calls or in interviews.�
Jun 1, 2016
Gerardf My point is that the 14% floor space is no longer a relevant reference to the initial planned capacity of 50 GWh. You have more than once implied here and on various other forums that 14% floor space is not enough room for the cell & pack capacity required for the early Model-3 production. As of yesterday it is confirmed that that 14% floorspace (as they have already today) could very well be enough not for 14% but for 42% of the old plan of 50 GWh = 21 GWh. That 21 GWh alone would be enough capacity for 300.000 cars with even 70 kWh. And that is additional capacity to the currently available proven cell capacity available for Tesla of at least 75k / 100k cars a year. So even assuming Tesla will not extent the floorspace between now and 2018, there is not issue.
Thus my respectful request to not use this 14% or floor space argument again, not here, not on other websites, as you now know this is not a an honest statement.
You have often spread doubt on the investment already made into the GigaFactory...
I am not sure you followed the whole websession yesterday, but I now inform you that Elon Musk stated at the shareholders meeting that already today a total of 2B have been invested by Tesla and partners in the GigaFactory. That is 40% of that 5B investment already between site selection announcement in September 2014 and May 2016. 2B of the total 5B investment promised to be made until 2020. So no magic required, but lots of hard work and real money as both have indeed already been invested by Tesla and partners.
So next time you make statements here or on other forums where you create doubt by implying otherwise, be honest and explicitly accuse Tesla of lying in the shareholder meeting, so we can call you out on that. IMHO you should not make such statement without very strong proof.
(*) 2016 Shareholder Meeting | Tesla Motors at time 02.13.30 and further.
EDIT / P.S. just to be one step ahead before tftf would now make up a new complaint that 2B was already spend on just 14%.. How to finance ???
Well 2B equals 40% of 5B.. Just like 21 GWh equals (about) 40% of 50 GWh. Coincidence ?
And I actually claim that every next 10 GWh capacity will cost much, much less than 1B each as many significant on-time costs are already paid for now. (land, infrastructure etc, etc).�
Jun 1, 2016
techmaven I think this is worth re-emphasizing:
Tesla's has already invested most of what is necessary to achieve 2018, 300,000+ Model 3 volumes at the Gigafactory
Some basic facts:
Original size of the Gigafactory, cell production: 35 GWh
Initial pilot phase thought to be 1/5th size: 7 GWh
Total investment: $4 to 5 billion
Tesla's investment: $2 billion (still - figure in latest 10-Q)
Tesla investment through Q1, 2016: $380 million
Additional Tesla 2016 investment: $468 million
Panasonic's committed investment: $1.6 billion
Panasonic's investment through Q1, 2016: $128 million
Total investment through Q1, 2016: $508 million
Suminoe Plant total cost: $1.1 billion
Suminoe Plant capacity: 600 million cells, about ~7 GWh
By dramatically decreasing the floor space/GWh at the Gigafactory, Tesla took a huge chunk out of their costs at the Gigafactory. Assuming the cell making equipment cost remains the same, the cost to supply the shell for a given GWh capacity is now apparently far lower than previously announced.
At the Gigafactory, Tesla is responsible for the shell buildings, the power hookup, the parking lots, and the battery pack making equipment that turns the cells into battery packs. At $2 billion dollars for 35 GWh, we can look at the phases like this:
$50 million for site preparation
$100 million for ancillary buildings, grid connection, etc.
$250 million for on-site energy production
$320 million per phase shell buildings and battery pack assembly
So $50+$100+$320 = $470 million to get the first phase up and running
Tesla already spent $380 million as of 2 months ago and they expect to spend another $468 million this year, for a total of $848 million. That presumably includes a 2nd phase and some on-site energy production.
Now a phase is somewhere up to 3x what we used to think, which means instead of 7 GWh, we're talking about 20 GWh.
20 GWh / 60 kWh per Model 3 = 333,000 Model 3's.
That's roughly the amount of Model 3 production run rate through the end of 2018. In other words, the first pilot phase is enough to get to the end production rate in 2018, the announced 500,000 vehicles/year rate by incorporating Panasonic's Osaka plants in cell production. Now, it appears that Tesla isn't going to stop there, they will be adding another phase.
That means that they are investing enough in 2016 to get to 40 GWh of production, or more than the original cell production estimate.
This is huge news.
Presumably Musk's comment on $2 billion invested includes the fact that Panasonic's $1.6 billion committed is already spent... just not fully installed. After all, there is a lag time between ordering the equipment, signing the installation contracts (spending the money), and then the actual equipment install (report of investment to Nevada). That means the investment thus far is already almost double the Suminoe Plant investment and well in line with 14 GWh of production in Osaka, Japan, but it is cheaper to build in Nevada and there are huge improvement to the design of the factory. While they are doing more at the Gigafactory, it does provide a check on the investment size. We had thought that the $1.6 billion committed was over more phases... instead, all of it is for the first phase.
So the first phase costs are more like:
$50 milion site prep
$100 million ancillary buildings, grid connection, etc.
$320 million shell building + battery pack
$1.6 billion Panasonic's cell making equipment
$2 billion total invested, 20 GWh of capacity. Tesla's investment is roughly $470 million, the State of Nevada added $20 million, and there are some tax abatements and the like.
That means that out of the $3 billion in cash ex-ABL, what is necessary for 2018 Model 3 volumes is merely $100 million or so. The rest is Panasonic's. The fact that they are building out another entire phase now is what they mean by 50-50, automotive versus stationary storage. The pilot plant is enough for huge Model 3 volumes, but not enough for stationary storage on top of that. They are building a 2nd phase for Tesla Energy. Now, the actual production is likely more granularly divisible between Tesla Automotive and Tesla Energy and initial cells might actually be for Tesla Energy and then production output goes towards Model 3 and they choose allocation at their whim.�
Jun 1, 2016
madodel What do people make of this? Chowdhry On Tesla: GigaFactory Valued At $50 Billion - Tesla Motors, Inc. (NASDAQ:TSLA)�
Jun 1, 2016
Lessmog You know, it's cruel to pull legs off ftflies, right?
You also know, you probably mean 1.14^(3/2), right?
Sorry, but my abacus fell to pieces in the Hop Sing so I can't calculate how much that is in percent (given FX).
Edit: Oh, and thanks techmaven for pointing the finger!�
Jun 1, 2016
tftf So how come the investments reported to Nevada by Tesla and Panasonic arrive at a totally different, much smaller number by the start of calendar Q2 2016:
Panasonic doubled its investment in the Tesla Gigafactory during the last quarter [Q1 2016 Activity Report]
So where does the sudden $1.5 billion difference come from?
I doubt PENA (Panasonic NA) installed over a billion worth of equipment between April 1, 2016 and yesterday.
For a comparison, the former Q4 2015 numbers and totals were:
Tesla gigafactory jobs and investment climb, still short of projections
Why not wait and see what Tesla files in their next financial reports in written and not what Elon says during a 3.5 hour rant?
Either way, it's Panasonic, not Tesla who owns the machinery and manufactures the cells.
But why doesn't Tesla take over all of that?
Hearing Musk speak it appears that the Panasonics and Toyotas of this world apparently know next to nothing about efficient, high-quality manufacturing for batteries and cars...
Elon Musk goes on a �machines building machines� rant about the future of manufacturing
Looks like the next revolution in manufacturing is soon here thanks to Elon Musk. Time to finally throw away those old 1990 copies of The Machine That Changed The World.
That's it from my part. 2018 is here soon enough and we will see actual output and margins.�
Jun 1, 2016
neroden
I think this is very important as well. Going off the Gigafactory topic, Tesla has also built the paint shop for 500,000+ Model 3 volumes already (and seems to know how to copy it if needed?). They've designed nearly all of Model 3 except the interior. In general Tesla has been spending capital money on Model 3 well before telling anyone about it. I would expect that the production lines for Model 3 are far closer to complete than most outsiders expect, which makes hitting the target date more plausible.�
Jun 1, 2016
techmaven You know where the $1.5 billion dollar difference comes from - Panasonic's $1.6 billion investment in the Gigafactory. They're in the middle of spending it... for all we know, they've already spent it all, just waiting for all the equipment to arrive and the contractors to install it. Therefore, the Nevada reports will necessarily have a delay in comparison to when the companies have to have spent the money on their books.
The difference now is that we know the $1.6 billion is not spread over other phases, it's all part of the pilot phase. Which means the investment in the pilot phase will be around $2 billion, and a bunch of that investment is actually for infrastructure for the other phases. So now, the cap-ex requirements and schedule you've been harping about is suddenly very different. The footprint argument you've been making is now moot as far as Model 3 launch and initial scale up through 2018 goes. Plus, the capex argument also is moot, as Tesla has already spent almost all they need to hit 2018 scale up.�
Jun 1, 2016
Model 3 Is it not so that they even have installed the metal-presses it needs for the Model 3 volumes?�
Jun 1, 2016
MitchJi I think that's an insane way to determine the value of any asset.�
Jun 1, 2016
ecarfan From that article "The increase in productivity will occur in Tesla's Nevada Gigafactory, which is subsidized by the state." (that is not something Chowdhry said, it's the article author)
What a ridiculous statement to make without any context. As Elon and JB clearly explained yesterday, and not for the first time, the Nevada state subsidies are miniscule compared to the investments in the factory made by Tesla and Panasonic, and are spread out over 20 years.�
Jun 1, 2016
Gerardf Can you enlighten my why you refer to yesterdays shareholders meeting as a rant ?
I have seen it from start to end. It was long, very long.. Maybe some liked Elon's and JB's style, some maybe not so much. Some might like what was shared, some maybe found it less interesting.
One can say a lot about it, however to my opinion there was absolutely no ranting involved. At no point in the full websession. (Except maybe from one or two of the persons asking questions in the Q&A, even even they got very respectfull answers)
That remark shows your strong dislike of Elon Musk. Nothing wrong with not liking him, however IMHO it should not result in such unfair qualifications. It probably also means you are not able to honestly judge what was presented yesterday.
Straight question:
- do you think Mr. Musk (and / or Mr. Staubel) were telling lies ?
- or being dishonest or misleading shareholders in any way ?
Edit : typo / rephrasing�
Jun 2, 2016
tftf No, of course not. See, they are just avatars in a giant simulation game:
Odds are we�re living in a simulation, says Elon Musk
It's not real, don't worry. In case Tesla or Solarcity ever fail, the game will just be restarted.
I somehow didn't enjoy the classic simulations "Howard Hughes - Latter Years" and "DotCom Trilogy", so I'm staying away from this one.
But have fun playing.�
Jun 2, 2016
Johan Classy.
(Perhaps after the reboot the tftf bug will be gone? One can hope...)�
Jun 2, 2016
Gerardf You might think that is an answer, or somehow a smart way not to have to give a direct answer.
But why ? You are here as an anonymous person writing from "the Hop-Sing laundry".
What is the problem for you to simply give a straight answer on an honest question ?
- do you think really Mr. Musk (and / or Tesla management) are being dishonest and / or misleading shareholders (or even telling purposely telling lies) ?
Yes, I am really curious and honestly want to know if that IS indeed what you believe.
TFTF, for me it is clear that you do have a good understanding of automotive market. It is sad your opinion seems clouded by your dislike of Mr. Musk. As a result you give me (and others I assume) here the impression you are sometimes trolling. A pity and not needed, as I think you could have been a valuable resource here.
Moderator, feel free to move / delete this post if you want. I do not expect a straight answer, but hope TFTF surprises me.
Just wanted to give him a second opportunity to answer.�
Jun 2, 2016
electracity Exclusive: Tesla Takes Delivery Of 1.74 Million Samsung Battery Cells�
Jun 2, 2016
techmaven Not sure why this is in the Gigafactory thread.�
Jun 2, 2016
Gerasimental SDI ICR18650 - 2200mAh capacity at 65g weight.
Panasonic NCR18650B - 3180mAh at 49g weight.
These must be for Tesla Energy.�
Jun 2, 2016
Yuri_G Hmm, I think I'll believe the Titan of industry vs. the "guy" that thinks all the established manufacturers will release compelling EVs that trump Tesla. How many of those exist again? Yeah, keep the hope alive. They'll be there in 5, oh wait, let's say 10 years just to be safe!�
Jun 2, 2016
Model 3 Could it be the Roadster 3.0 batteries?�
Jun 2, 2016
Johan Not a bad idea, but the capacity both volumetrically and in Wh/kg seems too low with these cells to make sense for Roadster upgrades.�
Jun 2, 2016
dc_h Has anyone discussed the feasibility of the GF producing 3 times more battery storage due to increased chemical density, and not increased plant productivity? If they had some bigger gains in chemistry coming out for next year, they could produce twice the GWh, without 100% gain in production efficiency.�
Jun 2, 2016
MitchJi The ignore button is working well for me.
Not happening! That would be a revolutionary shift. Elon said "modest increase , not big, not small".
If they had that chemistry now why would they wait for the GF to introduce it?�
Jun 2, 2016
kenliles Elon 'Neo' Musk rebooting
Agent tftf (aka Smith n Jones)�
Jun 2, 2016
JRP3 Roadster 3.0 cells seem to be LG 3ah or so. 2.2ah is about the same or worse than the original Roadster cells, (I remember them as 2.4ah according to Martin). Could be stock for direct Roadster cell replacements I suppose if there are people who need replacement packs but don't want to upgrade, but I can't really imagine that making any sense since most of the labor would be the same, might as well put in the larger capacity cell.�
Jun 2, 2016
dc_h I heard a rumor from an Apple person that they expect battery chemistry to improve more rapidly in the next 2-3 years and for battery life to be greatly improved and they credit the work being done by and for Tesla. I don't see THE productivity coming from increased density, but what if they have identified more than incremental improvements. If their scale and structure allowed them to double improvements, that would allow them to double GF output by 2020, assuming about 20% annual gains. Other posts have brought up some new industry trends and it does seem unlikely that they would go unnoticed by Tesla.�
Jun 6, 2016
Jeff N Samsung SDI making progress in talks with Tesla to supply batteries - source�
Jun 7, 2016
tftf I said five years, 2017-2021. Except for maybe Toyota, all major car makers will offer a wide range EVs in all price categories before 2022.
(PHEVs even well before that, 2016-2020, these longer-range PHEVs such as the new Volt will offer good alternatives as well).
Not because of Tesla, but mainly because of upcoming emission regulations, better battery technology and better infrastructure:
- Stricter emission caps and penalties by the end of the decade in all major car markets (China, Europe, NA)
- Upgraded charging standards: Chademo and CCS both at 150 kW (and later 350kW if needed) for fast wired charging. Many of these CCS and Chademo charging networks are subsidized by public funds around the world, Tesla's stations for a single car brand are not.
- New battery plants in forms of JVs or other large supply contracts with mostly Asian suppliers as needed (don't think the planning/supply departments at these large car makers forgot about the batteries): LG; Samsung; Panasonic; Chinese brands...
Compare Tesla's hyperbole announcements "$5billion investment for Gigafactory 1", "up to 150 GWh from Gigafactory 1", "up to 1 million cars from Fremont", "millions of cars by 2025" and finally "we could match/exceed Apple's market cap within a decade" with the actual competition / reality on the ground by 2020-2022, not before.
Tesla and its CEO like to talk about the future - and rarely about the additional funds to get there. Large car makers and other relative newcomers (such as BYD) on the other hand execute quietly on their plans.
And they actually have the billions needed each year to get there.�
Jun 7, 2016
electracity Two points
1) Billions can come from debt, equity and partnerships. The partnership they will need in China may come with much of the financing needed for the Asia market. Europe won't be a complete factory at first.
2) The market seems fine with buying Tesla equity. If Tesla can execute on the model 3, this trend will likely continue on a larger scale.
I do expect Tesla to be capital limited on growth over the next decade. But the longer the Tesla backlog of orders, the cheaper the new capital.�
Jun 7, 2016
Yuri_G Your "predictions" are always optimistic for the incumbents and always pessimistic for Tesla. What is the current reality in the EV marketplace? Tesla is selling tens of thousands of $100k cars per year and the major OEMs can't match that with their $30k EVs. Tesla has the only reliable, fast-charging network.
The reality is Tesla is 5 years ahead of the competition and no other manufacturer is taking EVs seriously, in the year 2016. Your argument will always be flawed because the incumbents will not seriously build EVs at a mass market level. Tesla will be well entrenched in the market before another earnest player comes into the picture.
Again, how did your Hyundai Ioniq prediction pan out? When will BYD sell cars in the US?�
Jun 7, 2016
tftf I wrote that it's likely the Ioniq will likely have a range 150+ miles. It didn't. But Hyundai will have a 200-mile car by 2018 (different model):
Hyundai All-Electric SUV To Arrive In 2018, With 200 Miles Of Range
Now when will the Tesla Model3 ship in volume? Are you sure it will ship before that car given all the delays Tesla encountered?
As for BYD, they don't need to sell in the US (or anywhere else in the world:, their home market is large enough for many years to come:
BYD Qin Sales Top 50,000, Tang Exceed 30,000
Nearly 20,000 Plug-In Electric Cars Sold In China In April
But they already sell EV buses internationally, including the US:
AVTA to Become Nation's First 100% Electric Bus Fleet By 2018! Up To 85 BYD Buses
As for batteries:
China's BYD takes aim at Tesla in battery factory race�
Jun 7, 2016
JohnSnowNW No idea why you continually gloss over the fact that the range claims are always non-EPA. Wait, no, I do know why you do that.�
Jun 7, 2016
techmaven BYD makes LiFePO4 which makes them relatively immaterial when it comes to competing with Tesla. It's great for EVs overall, but you can't match Tesla's vehicles using LiFePO4. China also needs to alter their incentive structure as it rewards LiFePO4 production but not NMC which is a big, but easily solved problem. Regardless, LiFePO4 is already a dead end for vehicles - BYD will continue to do well for some time, but will have to make the costly transition in order to compete on the world stage or for higher end vehicles in China.�
Jun 7, 2016
tftf 1 GWh is 1 GWh. I wrote about BYD's capacity. And I don't think BYD will stand still on battery tech and new chemistry until 2021 either.
Did you even read my link?
Both the Ioniq EV and the new 2018 Hyundai EV SUV are given "real-world" ranges, ie. about 110 miles for the former and 200 miles for the latter.
Won't post more here since this is the GF investor thread.�
Jun 7, 2016
JohnSnowNW Uh, no, they assumed it was a real-world number for the SUV, because they had quoted one for the Ioniq. And you'll note the use of the term "up to" when discussing the SUV.�
Jun 7, 2016
austinEV So what? You seem to be making the argument that if BYD sells 20k cars in China Tesla is in trouble? The EV market is 20 years away from needing to worry about EV vs EV competition. EV's compete against all cars sold, not just other EV's.
You could be right about everything here and it isn't a concern for Tesla. This is like the guy who wants everyone to know that TM buys motors from taiwan. Just proving that there are other small players in the EV making game is interesting at best, good for the environment (hopefully) but not a financial concern.�
Jun 7, 2016
Jeff N Elon Musk on Twitter
�
Jun 8, 2016
tftf Musk only mentions current cars in his two tweets (first one already quoted above by Jeff):
Elon Musk on Twitter
That leaves the door open for other products / suppliers. As I see it:
Panasonic = Model3, S, X (at least for the time being)
LG Chem = upgraded Roadster
Samsung = ESS / buffer / stationary storage (at least rumored given the specs)
All of this still leaves two important questions open:
� Where�s Tesla "unique battery tech" that large investors such as Ron Baron blindly believe in? All other car makers get their cells (but in a different format) from the exact same Asian suppliers. Some of them have also invested in vertical integration (e.g. Nissan, years ahead of Tesla).
� Where will Tesla's/Panasonic's economies of scale advantage be in 5-10 years since LG has contracts with the world�s biggest car makers and Panasonic only supplies these cylindrical cells to Tesla?
LG has far more contracts and volume ahead assuming even a modest ramp from their PHEV and EV clients until 2020 or 2025.
I doubt Panasonic has any cost advantage over LG, Samsung or BYD long-term. Bye.�
Jun 8, 2016
Model 3 Hmmm.... Something does not add up here
Goodbye�
Jun 8, 2016
Johan Do you acknowledge that Panasonic are Tesla's equal partner in the Gigafactory venture, and that the Gigafactory is going to be the largest battery manufacturing plant in the world in a few years? If so, you argument hinges on you being able to present some kind of fact based information as to how, where and when, and with what financing, LG is going to manufacture these theoretically very large quantities of batteries in the years 2018-2025. Do you have any such information? It would sure be very interesting to all Tesla investors, long and short.
Here's what I mean, said another way: Elon Musk says "we (Tesla+Panasonic) will build the world's largest battery factory, where we will produce 50 GWh of batteries or possbily doube or triple that when we're at full capacity in 5 years". But he doesn't want us to blindly take his word for it. He has shown us the site, he has explained where the financing will come from, he has given a detailed schedule for construction, he has been to the financial markets to raise capital etc.
Now you say: "LG has far more contracts and volume ahead..." which I take to mean "more than Tesla+Panasonic". So now you have to present something to support your case, because even though you claim to be able to tell tales from the future and even though you might think Tesla longs have a tendency toward blind faith, neither is likely the case.�
Jun 8, 2016
tftf It does if you read my comment closely: It says cylindrical cells.
Panasonic delivers other cell types to other car makers.
The 20700 format still amounts thousands of small cells in a car. All of Tesla's competitors obviously use much larger cells.
Many experts say the costs of the two approaches will converge soon or that prismatic/pouch cells may even be cheaper than cylindrical cells.�
Jun 8, 2016
tftf I will acknowledge it once Tesla and Panasonic invested their full $4 to $5 billion into the project and nobody else steps up their battery manufacturing volume until then. So far, they (combined) only invested 10% of that sum*.
Size isn't static. VW AG is rumored to pour far more (about 10 billion EUR) into their battery plant if plans go ahead for cell production / vertical integration in Europe.
Again, Tesla talks about being the largest and recently also about expanding to 150 GWh. Talk is cheap.
The reported numbers in Nevada speak a different language.
* That is the $508 million until Q2 2016. These reports to Nevada officials and the SEC filings are the only numbers I believe in because Tesla can be held liable if they report wrong numbers.�
Jun 8, 2016
Johan In my world there is no doubt that Tesla and Panasonic will invest the full $4-5 billion, according to schedule. And in my world such a public commitment, detailed in quarterly financila reports, SEC filing, deals with the Federal government of Nevada etc. should be given far more weight than a "rumor" as you call it of an "about �10 billion" investment from VW in battery production. You see, Tesla have shown product lines that are coming to market in a few years where all these batteries will go (Model 3, Tesla Energy). VW have not.
From the outside (from my perspective) you sure seem to operate with double standards, meaning you put too much credence on soft rumors and maybes when it comes to competition, and far too little credence on hard commitment when it comes to Tesla.�
Jun 8, 2016
Model 3 That would be a good argument if Panasonic did deliver the exact same cell chemistry/design in a different format to other car makers. But Tesla is the only customer of this type of cells, and that answers a part of your question:
The rest is in Teslas unique tech in the battery pack/software.�
Jun 8, 2016
Krugerrand 1. What many experts? Like name them and provide links to their 'expert' studies. I hope there's charts. The colors are so pretty.
2. Got any experts who aren't 'guessing'? Soon, may, might, maybe, possible, etc... doesn't instill confidence in the 'expert'. Indeed, an expert is suppose to know otherwise they aren't an expert.�
Jun 8, 2016
Gerardf I can not agree more with Krugerrand's point.
There is no company in the world than Tesla who has a bigger interest in using the best format cells for Automotive. Best is a balance between energy density, costs, safety and some other parameters. Note that optimum for PHEV's is might very well not be the optimum for BEV's.
One can be rest assured that Tesla is continuously looking into this, it has more more at stake in this than its competitors. Many of these competitors are even only doing EV's to limit their loss in ZEV costs, even Lutz publicly admitted GM is not doing EV's to make money. These competitors are OK with 'good enough' cells. For Tesla having the BEST possible cells is a matter of survival.
Again and again Tesla reconfirmed that they feel cylindrical cells are the optimum. And Tesla (and Musk) have proven at many occasions not to be afraid to make big changes in case something better comes up.
I trust Tesla, and the experts it has, far more than some other experts who still fail to deliver cells & packs that are better than Tesla's, even those from Tesla as long as 4 years ago.
TFTF, I have seen you using this argument on other forums as well. Please come up with a real answer on how your position on this can be defended, or stop using this argument.�
Jun 8, 2016
nativewolf Simply getting the factory built, at this scale, is a 2-3 year endeavor. LG will have to build somewhere other than Korea to build at the scale contemplated by Tesla. A number of Chinese companies could raise the money and do the same, they'd be 3 years behind but that's not the end of the world. VW could do this too, no issues for them to drop $4 billion in cash on a factory that will lead them to fire tens of thousands of workers as they'll not need to make ICE drivetrains. Oh...wait, the employees are running the company. Hmmmm...
In the brave new world where you remove the ICE manufactures advantage in drive trains it helps to not have ICE roots. You move faster.
GM is moving faster than anyone else, Nissan second, in the ICE world. As long as you are a posting no facts, no charts, no names you'd be better off just hypothesizing that one of the Chinese companies may catch Tesla due to Chinese govt state support. That at least may be realistic. However, if they do so it will be because China agreed to pump $20billion down a rat hole.
None of that takes into account the combined advantage of AI and Supercharger networks. Tesla is building on a very very solid foundation, maybe 5 year head start that allows them to be the first to a million battery powered vehicles. Then we start talking grid disruption ....�
Jun 8, 2016
tinm When is the next major build-out of the GF structure?
Will there be any expansion in 2016, or will the footprint only start growing in 2017? Is there a schedule published anywhere?�
Jun 8, 2016
austinEV Guys, we are arguing against a strawman yet again. TFTF is suggesting that if the global battery market has a revolution of capacity, size and low cost somehow that is bad for Tesla. I have said this before: TM would love to just buy batteries on the open market and compete with good styling, software, autopilot features etc. They are engaged with building a capital intensive factory because they had to, not because they possessed super battery tech.�
Không có nhận xét nào:
Đăng nhận xét