In addition to the 3x statement you mentioned JB and Elon said that they can produce enough cells at the GF for both TE and cars.
I listened in on the SH meeting. I must've missed where they said they can
produce enough
CELLS for both TM & TE at the GF. If you have link handy, I'd appreciate it. And ultimately, they could not know, as they don't know the true demand of both beyond current demand. Perhaps it could be more demand than they could scale in their "expedited timeline".
If Samsung can make cells for less than Tesla can using the GF why in the world did it make sense to even build the GF?
Because Samsung can not make same spec cells as GF cells for less cost. I think the point you maybe missing is that the cost to make Good Cells within spec is the same as the Cells that have less capacity/density within the batch. In traditional Battery mfg, these cells are not pass(keep) & fail(throwaway), but tiered based on performance and sold at appropriate price points. So, I think it's possible that Panasonic's mfg technique is at a point where they can't produce enough out of spec cells for TE powerwall, and Samsung's yield is such that they can afford to sell the lowest tiered cells at a price point attractive to Tesla. Sure, their cost is still higher than Panasonic, but they don't need to make same margin on the "out of spec" cells. And I'm sure Samsung wants to build relationship with Tesla, and losing a bit of money on stuff I can't sell as 1st tier product in exchange for future business, is not uncommon in the Korean Business culture.
Why do you think that as they become available that they won't transition to using the 20700 cells everywhere except the Roadster? The modules in both the TE products and the cars are very similar. We will find out when they start selling TE packs with GF cells because the capacity will increase by at least 7.5% based on the format plus any increase due to improved cell chemistry.
Sure, agreed. I think eventually that should be the plan, once Samsung no longer can provide current capacity cells at a price lower than GF failed/throwaway cells.
Why do you think that the TE margins are less than the TM margins? They said that they expect the margins to be equal over time, but if you know that they're making a profit now and then figure out how much less the GF Cells cost compared to the GF cells (at least 35% less) how can you not come to the conclusion that their margin on TE products will be at least 50%?
I don't believe I said TE margins are less than TM margins. If it came across that way, it was a miscommunication on my part. Battery cells are subassembly of a subassembly, So once you roll up the costs with labor, I'm sure TE has a higher overall margin, especially at the recently increased unit prices. But at the cell level, the cost of producing good cells that can be used in cars is the same as out of spec cells that can only be used for TE. So my point was, why would you use the in spec cells that you can use for TM in TE products(assuming they yield mostly in spec cells), when you can just buy them from Samsung on the cheap(speculating)?
Not trying to prove anything... Just hoping to explains my point of view in further detail...