2020 has held a lot of uncertainty but one thing is always certain: Tesla is in the news. Most recently, Tesla is getting international attention over what it refers to as “Battery Day”, a day of disclosure about the current state of their batteries, their forward-looking innovations, and what progress will mean for the future of electric vehicles (EVs).
As one of the most consistently newsworthy companies in the world, why should you care about this specific event from Tesla? Put simply, Battery Day may matter more than financial reports to some investors as it represents Tesla’s future, instead of simply recounting their recent past. For a bit more information about the importance of forward-looking information for high-growth companies, check out our article on Snowflake, the recent high-growth software IPO out of the Valley.
Furthermore, the main goal of the company is to make EVs accessible to all and render gasoline vehicles obsolete and Battery Day is an indicator of how close to that goal Tesla is getting.
Read on for the top 3 takeaways from Tesla’s Battery Day:
1. “Affordability Is Key to How We Scale”
While eco-enthusiasts and technophiles alike jump at the idea of getting a Tesla, it’s too expensive for most, even with the release of the Model 3 (at a price point just north of $50,000 CAD). With cost-reduction a central theme throughout the Battery Day announcements, a goal has been reiterated: cut consumer price in half and create a $25,000 car. While this goal is not new, as Musk first promised a $25K car in 2018, we are nearing the end of the 3-year timeline in which this would supposedly be possible.
Musk has gone on record stating that “it’s absolutely critical that we make cars that people can actually afford” in order to continue growing Tesla and achieve widespread adoption of EVs; however, Musk also knows that Tesla has become a luxury brand for many and, in tandem with the affordability speech, he also announced that they were releasing their most expensive model yet.
The new model is called “Model S Plaid” and will be available in late 2021 with a top speed of 200 mph, 520-mile range per charge, and an ability to go 0-60 mph in under two seconds.
2. Range Improvements
Utility is debatably an even larger consideration than cost, for most consumers considering the switch. Don’t be fooled by the Model S Plaid’s 520-mile range; when comparing the typical range of EVs to gas-powered cars, oftentimes you can get 2-3 times longer range from a full tank of gas than you could from a fully charged battery, leaving users unsatisfied if they want to drive long distances, adventure away from charging stations, or simply don’t want to spend their time waiting for their car to charge.
To address this, Tesla has decided to take matters into its own hands and bring battery production in-house. Tesla has developed its own “tabless” batteries, which are supposed to help power up their vehicles by about 6x and improve range by 16%. While this is still a long way off from beating out gas-power, it’s a charge in the right direction.
3. Battery Composition
For Tesla, getting into the battery-production business also involves building its first North American cathode (aka, battery) plant in Austin, Texas, with plans to construct further facilities in coming years. Vertically integrating its manufacturing process and decreasing reliance on players like Panasonic (who Tesla is currently sourcing batteries from) will allegedly help bolster car manufacturing as delays from Panasonic were reported to slow down the production of the Model Y and the Model 3.
Lastly, Tesla has made further progress on eliminating cobalt from their batteries and thus, their supply chain, after major concerns have been voiced surrounding the human rights violations in the cobalt mining process. While cobalt was not a central metal in their batteries, this move will supposedly make the batteries cheaper to produce while circumventing the ethical issue.
Altogether, the in-house production of batteries is supposed to cut costs all along the line, helping to inch closer to the $25,000 Tesla goal.