Tesla Has Enough Battery Cells
Tesla has enough battery cells and its for something different than cars. Most people are missing this and Tesla Energy is the area of the company that is going to explode in sales volume because of this.
Tesla now has a dedicated factory to manufacturing Megapacks in Lathrop, CA. Most people don't even realize this factory exists. This factory will manufacture about 40 GW hours a year. That's about 700,000 standard range Tesla vehicles.
Tesla is in the process of ramping production in this factory to address the growing demand of Tesla Energy and battery storage. At the end of October, Tesla was at the run rate of 25 Megapacks per day. Each Megpack is 4.9 MWh or 97.5 MWh/day or 35.6 Gwh/year.
This is recent and wasn't something quite noticed in Q3, 2022. It is most likely going to be realized in Q4, 2022. Is the Lathrop factory really at 25 per day and ramped to volume production?
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The Future of Tesla Energy
Even if the total output for 2023 is only 35 GWh, that is going to have a major impact on Tesla. Tesla is now making these battery storage Megpacks with LFP batteries, with a new version of the Megapack XL. LFP are far more suited for energy storage and for standard range electric vehicles.
The lack of energy density doesn't matter for stationary storage and this lowers the cost significantly. Also, the abundance of iron makes it much easier to get these Megpacks produced at scale.
This is starting to get the attention of the Tesla investor community. The cost currently is now closer to $100 due to the large amount of Megpacks being created. All of this was in a previous article we wrote about Tesla Energy.
Tesla charges up from $2 million to $2.6 million for each Megpack. Each costs about $1 million to produce. This leads to a high profit margin per Megapack sold. The Model 3 RWD is $47,000 in the U.S. and has a $15,000 gross profit and this isn't as high as the Megapack.
Cars aren't actually Tesla's product - battery cells are. It's the battery cells that matter. As long as Tesla can get tons of battery cells, they then can simply make methods of using these cells that are useful, like cars and stationary storage.
Megapacks are MUCH simpler to manufacture than a car or a robot. This is a sleeper and Tesla has enough supply now to ramp quickly its energy storage business.
What do you think of Tesla energy? Is Tesla a battery company?
For more information, see this video from Tesla Economist:
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.