While Tesla’s “Battery Day” lacked the fanfare that Elon Musk usually brings to the stage, the event wasn’t exactly the letdown that some have called it. In fact, much of the presentation involved Musk revealing some exciting news about advanced designs and materials, as well as outlining some of the challenges engineers face in making a $25,000 electric vehicle (EV).
The Goal: A $25,000 EV
Ultimately, Tesla’s goal is to build an electric vehicle that’s cost-competitive with internal combustion engine vehicles—not just in terms of the total cost of ownership, but in terms of the sticker price as well. Musk wants to produce an EV that sells for $25,000 within the next three years, but in order to do that, he needs to reduce the cost of the most expensive component of these vehicles: the battery pack. The U.S. Department of Energy established EV battery targets—priced below $100/kWh and with a range of at least 300 miles (482 km)—and Musk has a plan to meet, or even exceed, those numbers. How? Tesla will start by eliminating most of the outsourced components and producing as much of the vehicles in-house as possible. Then, the company will optimize those systems to eke out the most performance for the least cost. It’s an ambitious plan, so let’s check out some of the details.
Vertical Integration
Vertical integration is a concept in which a manufacturer also owns most of the supply chain, allowing the company to control all aspects of manufacturing without having to pay the overhead associated with outsourcing. Musk says that vertically integrating Tesla could result in a 54 percent increase in range, due to Tesla’s own materials research and design methods, and a 56 percent reduction in cost, thanks to the company’s process improvements.
While Tesla builds its own battery packs, it outsources the cells themselves from Panasonic, which makes the battery cells in Tesla’s Nevada Gigafactory. That relationship will continue and, due to the sheer volume of cells needed to meet its demand, Tesla will buy cells from other manufacturers as well. But as part of its vertical integration strategy, Tesla will begin making its own cells at its Fremont, Calif. factory. There, the company will produce cells with a new “4680” form factor.
Tesla claims that the new form factor will result in a five-times increase in energy and a six-times increase in power. The larger cell size allows more capacity in the same space, and the tabless design shortens the travel path for electrons, reducing losses (and heat) and improving power output. The company hasn’t quite nailed down the manufacturing process for these cells, but Musk believes his engineers are close.
Cutting Cathode Costs
Regardless of the form factor, a significant problem with lithium-ion cells is the cathode: it’s expensive, it relies on materials that come from questionable sources, and it’s often a source of battery degradation. To reduce costs and assure that responsible mining and labor practices are used in their production, Tesla will manufacture its own cathodes from domestic supplies. The company recently secured the rights to 10,000 acres of lithium mines in Nevada, and plans to use only domestically produced nickel, a common cathode additive. Musk says that the company’s lithium mining process is as environmentally friendly as possible—taking a slice of dirt, extracting the lithium from it, and then “replacing the divot,” so to speak. Tesla developed a sulphate-free lithium conversion process, reducing the cost of lithium production by 33 percent.
Independent studies have shown that cathodes coated with a protective nanomaterial can survive four times as many charge cycles as their uncoated counterparts. But the coating adds an extra step to the cathode production process, increasing its cost. Nano One, an upstart technology company from Vancouver, Canada, thinks that cathode production could be a $40-billion industry by the end of this decade. The company’s “one pot” process reduces the cost and complexity of cathode material production by coating the nanocrystals as they’re produced, rather than coating a cluster of crystals, which is how current processes work. According to Nano One’s CTO, Stephen Campbell, this not only eliminates a costly step, but also improves the cathode’s durability. A cathode expands and contracts through charge-discharge cycles, which eventually cracks the coating in the same way that freeze-thaw cycles create potholes in a road. Coating individual nanocrystals allows the coating to stay intact, even as the crystals expand and contract.
I spoke with Nano One’s Campbell the day after Musk took the stage. He said that Tesla’s plans align quite well with Nano One’s technology. At this point, Nano One has demonstrated proof of concept, but the company is at least a year away from a scalable commercial system. It’s in the process of securing license agreements with mining companies and cell producers, including an unnamed “Asian Company.”
Cathodes come in a variety of chemistries, each with its own benefits and drawbacks. Nano One’s CEO, Dan Blondal, says that his company’s process can make any cathode material, so it could handle Tesla’s cells, regardless of whatever cathode chemistry Tesla chooses.
Cutting Anode Costs
The other end of the battery, the anode, is often made of graphite, an expensive conductor. Musk said that replacing graphite with silicon can not only reduce the cost of batteries, it can also increase their energy density, extending the vehicle’s range.
The problem, as Musk stated it, is that “With silicon, the cookie crumbles and gets gooey. That means that the material loses its energy retention and storage capacity. Every time a battery charges, the degradation means shorter life cycles for the battery.” To solve this, Tesla is developing its own silicon-based anode material, using very inexpensive metallurgical-grade silicon as its base. Musk didn’t specify a source of this metallurgical-grade silicon—might I suggest recycled solar panels?
Making the Battery One with the Car
Alluding to a jetliner’s wing serving double-duty as its fuel tank, Musk described an EV design in which the battery pack makes up part of the car’s frame. Starting with a special aluminum alloy, which doesn’t require coatings or heat treatment, Tesla’s die-casting process makes the front and rear sections of the car in one step. A “honeycomb sandwich” design makes the battery bank part of the car’s structure, reducing its cost and weight, while improving safety, handling and range.
Sustainability
The ultimate goal, of course, is a sustainable future, so Tesla wants to ensure that its EVs are as green as possible, from cradle to grave. The company’s vertical integration plan, along with its use of domestic materials, shortens the distance that supplies have to travel, reducing the carbon footprint associated with transporting goods. Tesla’s plan to simplify cathode production through better nickel processing also leads to ease of recycling, since the same process that extracts nickel from ore can extract nickel from recycled cathodes. Musk said that by weight, there’s far more lithium, nickel and cobalt in recycled battery materials than in raw ores, making recycling even more attractive. “Long term,” he continued, “New batteries will come from old batteries, once the fleet reaches steady state.” The company is building a pilot battery recycling plant in Nevada, which should be operational by early 2021.
Overall, Battery Day wasn’t glitzy like Musk’s introduction of the Solar Roof, Powerwall, or Semi, but what it lacked in flash, it made up for in substance. Perhaps that’s what we should expect from a $25,000 EV: practical but not pretentious. I can live with that.