Tesla Achieves Record Output on 4680 Battery Cells

Tesla just announced a milestone in its 4680 battery production. The team achieved 868,000 cells built in just 7 days.

Tesla 4680 Battery Progress Ramping

In a nice Christmas day announcement, Tesla shared that they have achieved 868,000 cells made in just 7 days, which is good enough for 1,000 cars per week. Annualized, that's 52,000 cars a year with 4680 batteries. And Tesla is not going to stop here.

The 4680 batteries are a crucial element for Tesla in further reducing cost and complexity of its vehicles. These cells are built in a Structural Battery Pack that becomes the floor of the vehicle, making things much less complex to put together. They are also more efficient than the standard 2170 batteries.

A Twitter user, Alex, has made a production ramp forecast for the 4680 batteries. He sees a run rate of 4,000,000 (4 million) cells per month in mid-January of 2023. The current run rate is about 3,840,000 per month.

You can see his prediction graph here. Tesla is definitely on an exponential trend and these 4680 batteries will be used in the Tesla Semi, the Model Y, the Cybertruck, and possibly the Model 3 with LFP batteries, but that remains to be seen.

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4680 Batteries and Costs

Tesla's 4680 batteries are important for Tesla to reduce costs and complexity. If the economy goes into a recession and interest rates continue to go up, then Tesla needs a way to keep their margins high and make a nice profit. This is where the 4680 batteries come in.

This seems to just be for the Kato Road facility on not including Giga Texas. When Giga Texas gets ramping, we should see 4680 battery production explode and able to satisfy any amount of demand that Tesla needs.

First, if the IRA (inflation reduction act) holds true, Tesla should get about $45 per kW of batteries produced. These costs will help offset any raise in interest rates or other material costs. Second, the batteries are more efficient than standard batteries, meaning a car with a 4680 battery pack gets more range and performance for less cost.

Tesla's Twitter account has been active with press and announcement lately, which is a good thing for Tesla. Investors and analysts have been spooked lately with what appears to be bad news, but so far, Tesla seems to be pushing through and executing well.

What do you think of the 4680 battery ramp? Are these important for Tesla to cut costs and make better vehicles?

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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.

Image Credit, BrandonTesla, Screenshot