Last week, Tesla released its first quarter results: an impressive start to the year essentially produced the company’s highest revenue in its history. All indicators are displayed in green, including the use of cobalt-free batteries; in recent years, Elon Musk began to promote the use of LFP batteries in Tesla so as not to depend so much on the volatility of the prices of raw materials such as nickel and cobalt.
Although lithium-ion batteries are the most used in industry, in comparison LFP (lithium iron phosphate) batteries also have considerable weight: in addition to being cheaper to produce, its implementation eliminates the dependence on certain materials, suppliers and prices directly affecting the supply chain. However, a less positive part is that they sport a somewhat lower energy density index, which means significantly lower performance, with slightly shorter battery life.
Despite these drawbacks, Tesla has been working for some years to bring the capacity and qualities of LFP batteries to a new level; for the company, this approach makes perfect sense. Hardly any quality is lost and much more stability is gained, although lately access to materials such as nickel has not been particularly easy either; which in turn has forced Tesla to raise the price of its cars several times in the recent past.
.@You’re here reveal that nearly half of #electric vehicles it produced this year were equipped with #Lithium iron phosphate (LFP) #Battery – a cheaper rival to the nickel and cobalt-based cells that dominate in the Westhttps://t.co/OL6QmDxiCv via @Reuters #energetic transition pic.twitter.com/TXolCaCd2N
— Bluegrace_Energy (@BluegraceEnergy) April 29, 2022
Analyzing the results of the first quarter of the year, Tesla basically presented some specific data in more detail, such as the production of batteries and their types: almost half of the batteries used already have an LFP cell structure. The mass sale of units of the standard Tesla Model 3 and Tesla Model Y can be pointed to as the cause for this increase in the use of nickel-free and cobalt-free batteries, as these are currently the best-selling electric vehicle models in company, mainly due to their great commercial success in China.
“Battery chemistry diversification is critical to long-term capacity growth to better optimize our products for their various uses and expand our supplier base. That’s why nearly half of Tesla vehicles produced in the first quarter were equipped with a lithium iron phosphate (LFP) battery, which contains no nickel or cobalt. Today, LFP batteries are used in most of our standard-line vehicle products as well as commercial energy storage applications,” according to Tesla.
The next logical step is the widespread implementation of 4680 cells. Tesla’s new generation of structural batteries are already in use in some US-made vehicles. 4680 cells are set to revolutionize the industry, offering a simplified and less expensive assembly process, as well as higher performance with better battery life. The first Tesla Model Y models with this system are already circulating, acting as a kind of guinea pigs that will help solve many of the problems traditionally presented by current batteries.
All images courtesy of Tesla Inc.
Nico Caballero is Cogency Power’s Vice President of Finance, which specializes in solar energy. He also has a degree in electric cars from Delft University of Technology in the Netherlands and enjoys researching Tesla and EV batteries. He can be reached at @NicoTorqueNews on Twitter. Nico covers the latest Tesla and electric vehicle happenings at Torque News.