Tesla is planning to introduce a new low-cost battery in its Model 3 sedan to China later this year. The new and cheaper long-life battery is expected to bring the cost of EVs down to the prices of typical internal combustion vehicles, according to sources.
Tesla Chief Executive Elon Musk has been teasing investors with a major upgrade in battery technology that would be revealed during a ‘Battery Day’ in late May. The company held a similar event revealing the impressive self-driving capability that has been added to Tesla cars.
If the claims are accurate, we could expect Tesla models to be selling for the same price as gasoline vehicles, or even less. This would be a major development for the electric vehicle, as for many consumers, electric cars have been too expensive.
The new batteries will rely on innovations such as low-cobalt and cobalt-free battery chemistries. Low-cobalt variations of batteries are important for EV vehicles and the industry, as the rise in demand has put the supply of the metal at risk. Additionally, chemical additives and coatings have been implemented to reduce internal stress and enable batteries to store more energy for longer periods, sources said.
The aptly named ’million mile‘ battery was jointly developed with China’s Contemporary Amperex Technology Ltd. A team of academic battery experts recruited by Musk also joined the effort. The ‘million mile’ name refers to the distance it is hoped a car equipped with this battery could cover before it needed replacing.
It seems Musk is confident in the future success of the new battery. A strategy telegraphed to analysts by Musk reveals Tesla’s plans to implement new high-speed and heavily automated battery manufacturing. The so-called ‘terafactories’ that could be built would be around 30 times the size of the company’s already-colossal Gigafactories.
The battery is expected to lower the cost per kilowatt-hour to under $100. According to experts, this would be the margin for electric cars to fall under the price range of gasoline cars. The drop in price is thanks to the low quantity of cobalt, which is currently the most expensive material in EV batteries. The price could drop even further if the battery packs provided for the EVs were completely cobalt-free, or the recycling and recovery of materials such as cobalt and nickel were factored in.
Eventually, an improved version of the battery would arrive in other markets. With a global fleet of more than 1 million electric vehicles, Tesla's goal is to achieve the status of a power company. It will be exciting to see what gets revealed at Tesla’s ‘Battery Day’ and how it will change the EV market for consumers and competitors alike.