Tesla and Panasonic have begun mass production of lithium-ion battery cells at the Gigafactory, which will be used in Tesla’s energy storage products and Model 3.
The cylindrical “2170 cell” was jointly designed and engineered by Tesla and Panasonic to offer performance at the lowest production cost in an optimal form factor for both electric vehicles and energy products.
Production of 2170 cells for qualification started in December and on Jan. 4, production began on cells that will be used in Tesla’s Powerwall 2 and Powerpack 2 energy products. Model 3 cell production will follow in Q2 and by 2018, the Gigafactory will produce 35 GWh/year of lithium-ion battery cells, nearly as much as the rest of the entire world’s battery production combined.
The Gigafactory is being built in phases so that Tesla, Panasonic, and other partners can begin manufacturing immediately inside the finished sections and continue to expand thereafter. The phased approach also allows Tesla to learn and continuously improve construction and operational techniques as it continues to drive down the cost of energy storage. Already, the current structure has a footprint of 1.9 million square feet, which houses 4.9 million square feet of operational space across several floors. Tesla said that it is still less than 30 percent done.
With the Gigafactory online and ramping up production, the cost of battery cells should significantly decline due to increasing automation and process design to enhance yield, lowered capital investment per Wh of production, the simple optimization of locating most manufacturing processes under one roof, and economies of scale.
In 2017 alone, Tesla and Panasonic will hire several thousand local employees and at peak production, the Gigafactory will directly employ 6,500 people and indirectly create between 20,000 to 30,000 additional jobs in the surrounding regions.
