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Brovane
Member
If the claim by Musk is correct that Giga-Factory production allows Tesla/Panasonic to produce 2170 cells at a 30% cost savings compared to 18650 cell's then why wouldn't Tesla eventually switch over to get a 30% cost saving on one of the most expensive components in an EV? (The battery pack)
Yes, eventually. But in the meanwhile, we know nothing about the EV chemistry (they have only just begun to produce those cells, much less battery modules and packs). The 2170s being produced at GF1 before this are for storage and not cars (different chemistry all together). Further, the 30% cost savings is misconstrued. Tesla has achieved 5-6% annual efficiency gains in cell and pack level technology. This, over time, resulted in the 30% efficiency claim. 2170 was not explicitly 30% cheaper than 18650. Rather, it has greater energy density due to the chemistry and form factor and therefore, per kwh, can be cheaper (the 30% figure is merely an estimate, they only just now began producing these cells and so we'll all see whether that pans out).
Brovane
Member
So Telsa is supposed to start production of the Model 3 in a couple of weeks and they haven't actually produced a 2170 battery pack for the Model 3? I would hope that the current "Beta" prototypes of the Model 3 we are seeing on the streets are using the 2170 battery pack. If they are using the old 18650 battery pack, Tesla is more behind that they are admitting on the Model 3 production.
Musk was fairly specific that the Giga-Factory was necessary to produce a 30% cost savings for batteries. So unless they are producing both 2170 and 18650 batteries at the Giga-Factory. A 75Kwh battery pack out of the Giga-Factory using 2170 cells is going to be cheaper than a 75Kwh battery pack using 18650 cells produced overseas.
All of this is beside the point, we have Musk on an investor conference call earlier this year saying that the Model S and X would transition to 2170 by the end of the year. Now we have a tweet from Musk contradicting what he apparently said earlier this year.
Sometimes Twitter can be both a blessing and a curse, just ask POTUS.
Olle
Active Member
Much of the 30% cost savings (Tesla has said 50% in the earnings calls) has to do with improved supply chain and logistics.
Brovane
Member
You just contradicted yourself. Earlier you said no battery modules and packs and now you are saying they only have handbuilt packs.
#1- How do you know they are only hand building packs? Source?
#2- This still ignores this reality, we have Musk on an investor conference call earlier this year saying that the Model S and X would transition to 2170 by the end of the year. Now we have a tweet from Musk contradicting what he apparently said earlier this year.
Brovane
Member
So what does this have to do with Panasonic producing 18650 cells overseas? Are you claiming that Panasonic is also improving it's logistics overseas to deliver a 30%+ cost saving to Tesla?
Do you disagree with my statement earlier?
Musk was fairly specific that the Giga-Factory was necessary to produce a 30% cost savings for batteries. So unless they are producing both 2170 and 18650 batteries at the Giga-Factory. A 75Kwh battery pack out of the Giga-Factory using 2170 cells is going to be cheaper than a 75Kwh battery pack using 18650 cells produced overseas.
Olle
Active Member
I imagined for a moment 18650 cells from the GF, but that probably won't happen. I agree with your statement.
Elon and his conflicting statements... Is the Model S going to have the latest tech, or not?
There are 3 reasons why he could have made that statement:
1. He did the same thing like with the Model S 90 pack, saying the Model S won't get a pack upgrade and halve a year later it gets a pack upgrade. No plans does't really mean it won't happen within a year. Just ambivalent wording and a good way to keep sales coming.
2. Tesla will switch to new 18650s for the S and X, with improved chemistry and higher energy density. (I don't think so, but it would still have some cost, weight, power, charging, efficiency benefits)
3. The Model S and X won't get them for some time and be stuck with the current cells. I'd be disappointed if that happened, but if they have their reasons, it's ok. I just don't hope the Model S/X will suffer a lack of innovation in other regards, too. I was planning to replace mine late 2018.
There are 3 reasons why he could have made that statement:
1. He did the same thing like with the Model S 90 pack, saying the Model S won't get a pack upgrade and halve a year later it gets a pack upgrade. No plans does't really mean it won't happen within a year. Just ambivalent wording and a good way to keep sales coming.
2. Tesla will switch to new 18650s for the S and X, with improved chemistry and higher energy density. (I don't think so, but it would still have some cost, weight, power, charging, efficiency benefits)
3. The Model S and X won't get them for some time and be stuck with the current cells. I'd be disappointed if that happened, but if they have their reasons, it's ok. I just don't hope the Model S/X will suffer a lack of innovation in other regards, too. I was planning to replace mine late 2018.
Brovane
Member
I personally think it is #1, he doesn't want to have people not buying Model S and X's waiting for 2170 pack upgrades. The tweet has to be taken in the context of what was said during the investor conference call.
I fully expect that by sometime in Q4 there will be an announcement of a new pack for the Model S and X in the 120-130 Kwh range using 2170 cells out of Giga-factory. The new baseline battery pack for the Model S and X will be 100 Kwh. Being able to shave 30%+ of the cost of packs will be too much to pass up. Also being able to tweak the other car manufacturers with a 600km range EV in 2018 will be a bonus.
I don't really agree they are downplaying the S and X for a sales advantage. I truly think the intent is to keep the higher end cars elevated in tech and battery from the 3s and can see something else going into those. I do believe he doesn't want people to wait and then be disappointed as he said. I don't know what people think about the Model 3, but to me it is even more minimal than the S/X and while a beautiful car on the outside I'm doubtful I would chose it over an S unless $s were the main consideration.
Don't forget Jeff Dahn and group have been working on improving battery technology since mid- last year I think and no one has said that their work is included in the 2170 formulation. Could be they are designing something different for the S and Xs to elevate them above the Model 3 in range and charging. They don't expect to sell as many S and Xs as 3s so the savings on these might not be as great as the 2170s unless they were to sell their batteries to other car manufacturers (which I occasionally keep hearing about).
BTW weren't there some comments recently about reaching some 30% increase in Li-Ion? What's coming out down the road doesn't mean it's going to be the current Li-Ion battery either - seeing talk of possibly solid-state batteries. Perhaps that new technology will go into the S and Xs. And we have the Semi in the works as well. If the Semi could use the same battery technology as the S and Xs, they might get cost savings there.
Don't forget Jeff Dahn and group have been working on improving battery technology since mid- last year I think and no one has said that their work is included in the 2170 formulation. Could be they are designing something different for the S and Xs to elevate them above the Model 3 in range and charging. They don't expect to sell as many S and Xs as 3s so the savings on these might not be as great as the 2170s unless they were to sell their batteries to other car manufacturers (which I occasionally keep hearing about).
BTW weren't there some comments recently about reaching some 30% increase in Li-Ion? What's coming out down the road doesn't mean it's going to be the current Li-Ion battery either - seeing talk of possibly solid-state batteries. Perhaps that new technology will go into the S and Xs. And we have the Semi in the works as well. If the Semi could use the same battery technology as the S and Xs, they might get cost savings there.
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I don't believe the contract has a dead end date, it's a quantity contract and Tesla is expected to hit the quantity by the end of this year. They may hit it a little before or after the end of the year though. Everything depends on Model S/X production volume throughout this year.
Tesla might extend the 18650 contract when the current one runs out if the GF isn't producing enough 2170s to switch over.
I agree. The point of the 2170 was cost reduction. It was to make the model 3 battery affordable. Why would they optimize performance, or longevity? It wouldn't make sense. And now Elon has confirmed this (read the update at bottom):
Elon Musk Says Tesla Model S & X Won't Get New 2170 Cell
There is likely no end user benefit to the new 2170 cells. Tesla benefits in that the batteries are cheaper.
I think people are misunderstanding various bits of battery tech being reported upon. For example, Dahn's latest video where he talks about increasing cell longevity doesn't mean we will have longer lasting cells. The context of that video was increasing longevity for high voltage cells, which heretofore had crappy cycle life. So really, that tech is all about increasing energy density on a cell that can have about the same cycle life of a normal low voltage cell. To the end user, nothing changes. To Tesla, it means cheaper batteries.
But that cost reduction comes with an increase in energy density, about a third more. That, IMO, is an advantage over the Model S/X. I am not sure if I'm going to buy a car that carries around 25% of unnecessary battery mass and pay premium for it.
Yes, so, basically I do not believe Elon Musk on this one. I think the comments are pretty much worthless as far as information value on product changes goes. Elon has a different interest here, than the customer. Fool me once and so forth.
I am confident Model S/X will get 2170 cells and I am also confident there are actual plans for that. Tesla has also explained, in depth, why 2170's are better - not just about cost, but about technological evolution with benefits of that - and it just is common sense.
In the meanwhile, Tesla wants to sell the current model and has been seen to act accordingly with very little moral scruples about it. So they are anti-selling the 2170 now. Just like with Model 3 in general. In some months time all this talk will be forgotten.
No plans to change the 100 kWh pack actually suggests to me 2170's might even result in a bigger kWh pack from Tesla (and I know they said they'd stop at 100 kWh, but I do not necessarily believe them). Prepare to buy a 100 kWh Model S/X and see a 120 kWh Model S/X appear soon after - it is possible, though not something I'd expect for Q3 yet. Who knows about Q1.
They want to put you in a new Model S/X and clearly are worried about Osborning, that's the key takeaway here. IMO the only question about 2170's coming to Model S/X is when, not if.
I am confident Model S/X will get 2170 cells and I am also confident there are actual plans for that. Tesla has also explained, in depth, why 2170's are better - not just about cost, but about technological evolution with benefits of that - and it just is common sense.
In the meanwhile, Tesla wants to sell the current model and has been seen to act accordingly with very little moral scruples about it. So they are anti-selling the 2170 now. Just like with Model 3 in general. In some months time all this talk will be forgotten.
No plans to change the 100 kWh pack actually suggests to me 2170's might even result in a bigger kWh pack from Tesla (and I know they said they'd stop at 100 kWh, but I do not necessarily believe them). Prepare to buy a 100 kWh Model S/X and see a 120 kWh Model S/X appear soon after - it is possible, though not something I'd expect for Q3 yet. Who knows about Q1.
They want to put you in a new Model S/X and clearly are worried about Osborning, that's the key takeaway here. IMO the only question about 2170's coming to Model S/X is when, not if.
Because of technical evolution, obviously. Why would they make a worse cell? Why would they build a massive factory (soon network of factories) to produce that cell? 2170 is the future of Tesla and they have poured everything they know into it with their battery partners. It is the next-gen of automotive batteries.
Trust me, it will be more than just about cost reduction. It will have technical benefits, potentially massive ones. The const-reduction angle is just a part of the story that is fed to us in the meanwhile, so we'd keep buying the old batteries.
Tesla has a conflict of interest here. They want us to buy the old battery, while they also want to make new and better batteries. We as customers have different interests than Tesla.
As far as the 30% (sometimes 50%) cost reduction was the eventual cost savings when at full production. It may also be comparing to some point in time, like when they broke ground on the GigaFactory. The 18650 is at stable production now and are as cheap as they are going to get. The 2170 is just starting production and whenever you start mass production of anything, the first ones you produce are always going to be more expensive: the workers need training, the kinks in the process haven't been fully worked out, the flow of the production line has inefficiencies that will be worked out over time, plus the raw materials are usually more expensive in the smaller volumes you need for the first production batches. Nobody wants to go into full scale production from zero because if there are some flaws, you could have just produced a million units that need to go in the trash (or recycler). You want to produce in small numbers first to ensure you got it right.
Until the end of this year, 2170 cells might actually cost more than 18650s do. Once the production is smoothed out, the 2170 will be cheaper.
Another issue Tesla needs to weigh is that 2170 production is going to ramp up at a given rate and it probably can't go much faster. The rate of Model 3 production is closely dependent on the battery production ramp. For the first six months to a year of Model 3 production, there will be just barely enough 2170s to meet the needs of Model 3 production and the Model 3 is designed from the ground up to use 2170s, they can't substitute 18650s without redesigning the pack and going through a lot of extra testing.
Meanwhile Model S and X production is both stable and profitable with 18650s. They are probably testing some prototype packs with 2170s and getting that redesign ready to go when there are enough cells available, but the 18650 does the job until there are enough 2170s available to start making S and X with the new cells.
This is very common in production. There is a part that is in short supply. The supply will be enough to switch the old product line to eventually, but in the short term, you have to make do with an older solution that works well enough until the newer part is available to your product.
Sometimes there never are enough of some part to go around. This was true of some aircraft engines in World War II for example. The US built two liquid cooled high performance V-12 engines: the Packard Merlin (built under license from Rolls Royce) and the Allison V-1710. The two engines were about the same weight and size, and both had similar performance at low altitudes, but the Merlin was superior above 15,000 feet.
You'd think it would be a no brainer to put Merlins in all aircraft, but the supply was limited and converting the Allison factory over to make Merlins under the war emergency was considered too much of a time loss. So the engines were allocated. Some British aircraft built in Canada used the Packard engines, and some Spitfires made in the UK used them when Rolls Royce made engines became scarce, but the only American built aircraft to get the Merlin was the P-51 Mustang (originally built for the British) and some versions of the P-40 Warhawk. Lockheed who made the P-38 redesigned the P-38 to take Merlins and calculated a huge weight savings from deleting the external superchargers, but they never even got authorized to build a prototype. There weren't enough Merlins to build P-38s with them, so why bother even testing it?
In this case, there is no crisis, just a production ramp that's going to take some time to complete. When the GF is able to make enough extra 2170s to keep up with Model 3 production and make at least some Model S/X with 2170s, it will happen, but not before then. Tesla will probably roll out the 2170 cars with some new capacity at a premium with the P versions first and only later will they convert all production to 2170s as enough become available.
Tesla's future is riding on the Model 3 (and other mass produced cars) and they can't afford to have Model S/X production compete with Model 3s for parts.
Until the end of this year, 2170 cells might actually cost more than 18650s do. Once the production is smoothed out, the 2170 will be cheaper.
Another issue Tesla needs to weigh is that 2170 production is going to ramp up at a given rate and it probably can't go much faster. The rate of Model 3 production is closely dependent on the battery production ramp. For the first six months to a year of Model 3 production, there will be just barely enough 2170s to meet the needs of Model 3 production and the Model 3 is designed from the ground up to use 2170s, they can't substitute 18650s without redesigning the pack and going through a lot of extra testing.
Meanwhile Model S and X production is both stable and profitable with 18650s. They are probably testing some prototype packs with 2170s and getting that redesign ready to go when there are enough cells available, but the 18650 does the job until there are enough 2170s available to start making S and X with the new cells.
This is very common in production. There is a part that is in short supply. The supply will be enough to switch the old product line to eventually, but in the short term, you have to make do with an older solution that works well enough until the newer part is available to your product.
Sometimes there never are enough of some part to go around. This was true of some aircraft engines in World War II for example. The US built two liquid cooled high performance V-12 engines: the Packard Merlin (built under license from Rolls Royce) and the Allison V-1710. The two engines were about the same weight and size, and both had similar performance at low altitudes, but the Merlin was superior above 15,000 feet.
You'd think it would be a no brainer to put Merlins in all aircraft, but the supply was limited and converting the Allison factory over to make Merlins under the war emergency was considered too much of a time loss. So the engines were allocated. Some British aircraft built in Canada used the Packard engines, and some Spitfires made in the UK used them when Rolls Royce made engines became scarce, but the only American built aircraft to get the Merlin was the P-51 Mustang (originally built for the British) and some versions of the P-40 Warhawk. Lockheed who made the P-38 redesigned the P-38 to take Merlins and calculated a huge weight savings from deleting the external superchargers, but they never even got authorized to build a prototype. There weren't enough Merlins to build P-38s with them, so why bother even testing it?
In this case, there is no crisis, just a production ramp that's going to take some time to complete. When the GF is able to make enough extra 2170s to keep up with Model 3 production and make at least some Model S/X with 2170s, it will happen, but not before then. Tesla will probably roll out the 2170 cars with some new capacity at a premium with the P versions first and only later will they convert all production to 2170s as enough become available.
Tesla's future is riding on the Model 3 (and other mass produced cars) and they can't afford to have Model S/X production compete with Model 3s for parts.
@wdolson While what you say is obviously true, you forgot about the end-customer perspective.
During WWII, the pilot did not have the luxury of selecting which plane or engine to wait for, but if they had, obviously they would have wanted the Merlin with superior performance.
A buyer thinking of going for a Model S/X today, or waiting maybe six months for one with 2170's, is in a wholly different circumstance. Their priorities will not be the same as those of Tesla's - nor do those customers have the urgency of war - and that can be a problem for Tesla.
It is perfectly understandable and logical for a customer to want and choose to wait for 2170's in a Tesla. I follow the scene closely and would recommend that to anyone who has no pressing reason to buy now.
Had I not ordered a new car in first half of 2016, I would have put myself into holding pattern by now, definitely. Several changes to Model S/X seem very possible over the Model 3 launch quarters.
During WWII, the pilot did not have the luxury of selecting which plane or engine to wait for, but if they had, obviously they would have wanted the Merlin with superior performance.
A buyer thinking of going for a Model S/X today, or waiting maybe six months for one with 2170's, is in a wholly different circumstance. Their priorities will not be the same as those of Tesla's - nor do those customers have the urgency of war - and that can be a problem for Tesla.
It is perfectly understandable and logical for a customer to want and choose to wait for 2170's in a Tesla. I follow the scene closely and would recommend that to anyone who has no pressing reason to buy now.
Had I not ordered a new car in first half of 2016, I would have put myself into holding pattern by now, definitely. Several changes to Model S/X seem very possible over the Model 3 launch quarters.
What will happen when Supercharger V3 is announced, supporting ultrafast charging in 5 to 10 minutes?
It's possible this could be announced for the Model 3 as early as next month's unveiling. And because Tesla would not want to undercut sale of the higher priced S/X, they'd also likely have to announce SC V3 for S/X at the same time, if not earlier than the Model 3 announcement.
If S/X would need a new battery pack to support SC V3, it seems unlikely Tesla would build a new battery pack using the older batteries, and would instead of designed that pack with the newer 2170s.
So... If Musk has stated S/X won't get the 2170s - and Tesla does announce SC V3 soon, that could mean the current Tesla battery packs (at least the 100's) may be able to support SC V3 ultrafast charging, possibly with some changes to the charging circuits, but not requiring a new battery pack.
It's possible this could be announced for the Model 3 as early as next month's unveiling. And because Tesla would not want to undercut sale of the higher priced S/X, they'd also likely have to announce SC V3 for S/X at the same time, if not earlier than the Model 3 announcement.
If S/X would need a new battery pack to support SC V3, it seems unlikely Tesla would build a new battery pack using the older batteries, and would instead of designed that pack with the newer 2170s.
So... If Musk has stated S/X won't get the 2170s - and Tesla does announce SC V3 soon, that could mean the current Tesla battery packs (at least the 100's) may be able to support SC V3 ultrafast charging, possibly with some changes to the charging circuits, but not requiring a new battery pack.
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