When it comes to producing more vehicles, Tesla Inc's TSLA biggest supply issue is batteries. The company just can't get enough batteries to build all the vehicles it wants.
Because of this, Tesla decided to start its own battery factory with its new 4680 battery cells. Tesla will also still receive batteries from current partners such as LG Chem and Panasonic.
After posting a video of the battery factory in action, CEO Elon Musk talked about some of the inspiration behind Tesla's battery production decisions.
Battery cell production is the fundamental rate-limiter slowing down a sustainable energy future. Very important problem. https://t.co/MYOUSAC2AK— Elon Musk (@elonmusk) January 18, 2021
Musk tweeted that the best manufacturing technology is in high volume industries like food and beverages, medical devices, and toys. And the battery production line shown in the video does look similar to a bottling plant.
Benzinga's Take: It will be interesting to see if Tesla's production strategies pay off going forward. On battery day, Tesla mentioned battery prices could eventually fall as much as 50%, while also being able to supply enough cells to satisfy Tesla Semi, Roadster, Model S, X, and Cybertruck. Tesla's Plaid version Model S is expected by the end of 2021, although Musk hinted it may be coming sooner.
Photo courtesy of Tesla
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