Tesla's Megapack is a giant stationary storage of batteries. These are being made with LFP batteries now and these types of batteries are much more long lasting and can be charged to 100% without too much degradation. In fact, my Model 3 RWD uses LFP batteries and I've charged it to 100% quite regularly.
Why is Tesla Megapack such an important product? Because it helps provide an abundance of Energy storage that helps stabilize the grid and prevent outages. When the weather gets too cold or things freeze, Tesla Megapack can be drawn on for energy.
The more Tesla Megapacks that exist the better because it will increase the amount of backup Energy that is available for the grid. Tesla solar is able to capture Energy and Tesla PowerWall or Tesla Megapack will be able to store any extra energy for whenever it is needed - whether for outages, or to sell back to the grid during peak energy times for a profit.
Imagine that - you have a Tesla PowerWall, which is a much smaller version of Megapack for home use, and you store up energy in it from your solar panels - or even from the grid. You then sell excess energy to the grid during peak demand for a profit. That is the true power of Tesla Megapack.
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Tesla Energy - a Sleeping Giant
The reason Tesla Megapack is a sleeping giant is because of how fast Tesla's Lathrop factory in California got to 40 GWh of production and there is about a 2 year backlog of Megapacks. This is just from one factory. At 10,000 Megapacks per year, at $1.5 million in revenue, that is $15,000,000,000 or $15 billion in revenue. This is a high margin product, meaning that total yearly profit at 50% gross margins, which is very possible, could be $7.5 billion.
Tesla getting to the point that they had enough batteries for all their products is what is awakening this sleeping giant. If I were Tesla, I would start making factories all around the world to produce Megapacks as utility and energy is about in infinite demand.
Each Megapack can store over 3 MWh of energy, which is enough energy to power an average of 3,600 homes for one hour, or 150 homes for 24 hours. That is a lot of energy.
Tesla Megapack also comes pre-assembled and with a 20 year warranty and with its own inverter and over-the-air software updates. That means the Megapack gets better over time.
This product is going to make Tesla A LOT of money and nobody sees it yet. But they will once Tesla's earnings calls start to show energy revenue and profit shooting up.
Do you think Tesla Megapack is a sleeping giant? Will it make Tesla a lot of money?
Tesla MP growth will juice free cash flow given neg. working capital needs where receivables > payables. Payment from customers made in advance to reserve capacity and/or upon issuance of purchase order, with the remainder due upon delivery and commissioning of system. https://t.co/Rymb4zDQ6t— Zerosumgame33 (@Zerosumgame33) December 30, 2022
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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.