You are here: Home » International » News » Companies
Business Standard

Elon Musk sees no immediate boost from 'Battery Day' tech unveil

Many analysts and industry officials expected Musk to unveil battery improvements at the widely-anticipated event

Topics
Elon Musk | Tesla

Reuters 

Technology entrepreneur Elon Musk
Technology entrepreneur Elon Musk

By Akanksha Rana and Hyunjoo Jin

(Reuters) - Inc Chief Executive Officer said on Monday improvements to be unveiled at the electric-car maker's "Battery Day" event would not reach "serious high-volume production" until 2022, knocking its shares lower.

Many analysts and industry officials expected Musk to unveil battery improvements at the widely-anticipated event, extending the automaker's lead over General Motors , Volkswagen and other rivals.

In a tweet ahead of the event scheduled for Tuesday, Musk said: "This affects long-term production, especially Semi, Cybertruck & Roadster, but what we announce will not reach serious high-volume production until 2022."

Musk also said intends to increase battery cell purchases from suppliers Panasonic <6752.T>, South Korea's LG Chem <051910.KS> and China's CATL <300750.SZ>, and possibly with other partners as well.

Despite the cell suppliers' working at maximum speed, automaker still expects significant shortages in 2022 and beyond, he added.

Shares of the car maker were last down more than 5% at $425.50 in extended trade.

Tesla is working to produce new, bigger battery cells with higher energy capacity at its own manufacturing facility in Fremont, two people familiar with the matter have told Reuters. They said the battery cell would have a diameter of 42 mm, double the diameter of the 21 mm cell used in Model 3.

One of the people said Tesla's battery line would have an annual production capacity of 1 gigawatt-hours.

Battery sources and experts say Tesla faces challenges to mass produce batteries in-house by itself, and may have to partner with other battery vendors like Panasonic to mass-produce the batteries.

"Tesla lacks know-how in manufacturing processes and there are a number of challenges in manufacturing processes," an LG Chem insider told Reuters.

Some battery industry officials are wary that such move which could put pressure on battery prices.

"Tesla is sending signals to suppliers that they should further lower costs, and if not, Tesla would source more batteries in-house," a former LG Chem official said.

Tesla's shares had earlier risen on Monday, helped by a leaked email from Musk that said the company was hopeful of racking up record car deliveries in the third quarter.

 

(Reporting by Akanksha Rana and Sanjana Shivdas in Bengaluru and Hyunjoo Jin in SEOUL; Editing by Sriraj Kalluvila)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Tue, September 22 2020. 07:27 IST
RECOMMENDED FOR YOU
.