The 4680 Battery Cell – Tesla’s Latest Innovation

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During Tesla’s Battery Day event, Elon Musk unveiled the 4680 Battery Cell; a highly anticipated revolutionary battery cell.

The event took place right after the company’s Annual Shareholders Meeting. 

New Board Member

Among the key announcements during the Shareholders Meeting was the appointment of Mr. Hiromichi Mizuno as a new board member of Tesla. 

Mr. Mizuno is a financial executive who served as the Chief Investment Officer of the Japan Government Pension Investment Fund (GPIF). Mr. Mizuno will serve on the audit committee within Tesla’s Board.

The 4680 Battery Cell

Tesla CEO Elon Musk, alongside VP of Technology Drew Baglino, took the stage and made a cascade of important announcements.

Among those products, a highly-anticipated battery cell, the 4680. It will serve as the catalyst for achieving cost-parity between Electric Vehicles and ICE-powered cars. 

It is a 46-millimeters wide, 80-millimeter long battery cell. The 4680 will contribute to decreasing production costs. It will also increase energy density by five times, increase range by 16%, and improve power output by six times.

It will undoubtedly be at the forefront of Tesla’s objective to produce more affordable electric vehicles.  

Musk and Baglino also stated that the cell will decrease the amount of time needed to charge a Tesla vehicle. 

The cell is currently being produced at Tesla’s Fremont plant in California. 

The 4680 Provides Optimized Production Capacity = Lower Costs

Musk also announced that Tesla is “starting to ramp up production at our pilot 10 GWh factory”, referring to the Fremont Plant.

Musk also stated that reaching the 10 GWh output level will take around one year.  

The 4680 battery cell will enable a price per kWh reduction of 14%. This will allow Tesla to further decrease capital costs, hence further moving towards achieving the aforementioned cost-parity.  

From an economics standpoint, costs associated with auto manufacturing are reduced partially via high-volume production. 

So in order to produce more affordable EVs, battery cell production costs must decrease. 

This will trigger a domino effect. More cells translates to lower manufacturing costs, higher production and delivery output, and thus, more affordable EVs than ever before. 

The widely accepted number for price parity with gas-powered vehicles is $100 per kWh. 

Neither Musk nor Biglano specified what is the current cost per kWh for Tesla vehicles. So it is unknown if a 14% reduction would render Tesla cars as affordable as their gas-powered counterparts.

According to Forbes, Tesla’s current costs per kWh are estimated at $127 USD.

Our Take On the 4680 Battery Cell

EVs achieving price parity with ICE-powered vehicles is a foregone conclusion. Battery prices in 2010 cost approximately $1,100 per kWh. In 2019, they have fallen by a staggering 87% to reach $156 per kWh.

This is in large part due to the huge efforts by Tesla. While optimized cell efficiency is set to reduce the cost per kWh by 14%, it is not the endgame. 

Tesla’s main objective is to reduce it by 50%.

Stay tuned for more Battery Day news!


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