Tesla Could Step Further Down the Supply Chain for Battery Building

Tesla is on a mission to make its manufacturing processes more efficient. Creating its own batteries is a key part of that plan.
Written by Andrew Koole
Reviewed by Kathleen Flear
Apr 28, 2022
Automakers of all stripes have
Tesla
in their sights. And for a growing number of them, part of the tactic will be to emulate the company’s stronghold on its own supply chain.
While most established brands chose to partner with tech companies for their transition to electric powertrains, many of them are starting to develop their own
EV batteries
with the hopes that it will work out the way it did for Elon Musk & Co.
But Musk continues to prove to be a moving target. As its competitors start battery production, the Tesla CEO’s recent tweets have some industry experts suspecting the company will jump into the mining business to firm up its grasp on the next link in the supply chain.
Jerry
, your car ownership
super app
, has details below to keep you up to date.

Elon Musk’s tweet could signal Tesla’s next venture

Like the proverbial canary in a cole mine,
Elon Musk
’s Twitter feed has warned the industry of his company’s next moves more than once. His comment on April 8 may be the most recent example.
"Price of lithium has gone to insane levels!” he said. “Tesla might actually have to get into the mining & refining directly at scale, unless costs improve."
It’s unclear whether Musk was sharing a piece of Tesla’s established future strategy or he was speaking off the cuff, as he’s known to do. But when the richest person in the world makes a comment like that, people listen—specifically, competitors and industry analysts.
Speaking to
Reuters
, lithium analyst Seth Goldstein said that if Tesla is serious about extracting its own lithium, acquiring an existing company would be the wisest route to take.

Tesla’s battery game is already miles ahead of the competition 

As its heavy-hitting rivals break ground on battery plants, Tesla’s
lithium-ion
assembly line is already a well-oiled machine. 
Its Gigafactory in Nevada produces 24 gigawatt hours (GWh) of battery range a year and has a theoretical capacity of 35 GWhs. That’s enough battery packs to power 500,000 cars.
On top of the mammoth facility in Nevada, Tesla also produces battery packs in Shanghai and plans to start in its facilities in Berlin,
Germany
, Fremont, California, and Austin, Texas as well.
The battery packs themselves are also ahead of most competing brands, offering ranges between 272 and 405 miles, compared to the industry’s median range of 250 miles.

Better access to raw materials could help Tesla lower their prices

For years, Musk has expressed his goal to offer an EV for $25,000. But right now, supply chain troubles and prices for battery materials like lithium and cobalt are sending
Tesla’s ownership costs
in the opposite direction.
The Tesla Model 3, for example, had a starting price of $35,000 at the beginning of 2021. Now, the cheapest model costs $47,000. The increased production costs aren’t making
car insurance
any cheaper either. 
But if you’re willing to bite the bullet and pay the new higher price for a Tesla, make sure to use Jerry to find your car insurance. 
A licensed broker that offers end-to-end support, Jerry will generate competitive quotes from top providers in less than a minute. The average Jerry user saves over $800 a year.
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Nationwide
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Travelers
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