It looks like LG Energy Solution will produce the new large-format 4680 cells for Tesla from 2023. Production sites in the US and Europe are being considered to supply the Tesla plants there, yet a supply agreement has not been signed so far.
Referencing two unnamed sources, Reuters alleges that LG Energy Solution had already made samples for the Tesla 4680 cells. They confirmed the plans but said they had no supply agreement in place yet.
“LG plans to produce 4680 cells at its new US factory. They plan to build a new 4680 cell line to supply Tesla’s Giga Berlin in Europe,” one of the sources said, adding that Spain was one of the candidates for the European plant. LG is in talks as a partner for the public-private battery factory near Barcelona, for which plans were made official last Friday. However, other cell types for the VW Group could also be produced here – Seat and Cupra may be interested buyers.
So far, there is no information on where LGES may build the US plant. It would make sense for the plant to be located close to Fremont or Austin’s vehicle plants; Tesla also wants to manufacture the 4680 cells in Texas. If the rumours about Spain are true in Europe, LGES does not seem to be planning the battery factories in its customers’ vehicle plants’ immediate vicinity.
According to Reuters sources, there is a simple reason why a possible delivery could not start until 2023: LGES is not yet ready, as it has no experience with large-format cylindrical cells. According to someone familiar with the matter, LG faces “technological hurdles and the challenge of scaling up production”.
Neither Tesla nor LG Energy Solution would comment on the information when asked by Reuters.
Tesla already operates a pilot factory for the new battery cells in California and is preparing to produce them at new plants in Texas and Germany. Tesla’s battery partner Panasonic plans to start manufacturing prototypes of the new 4680 battery cell later this year. In China, Tesla is already being supplied by LG.
Tesla is sticking to Giga Berlin schedule
Tesla, meanwhile, is sticking to its ambitious schedule for its car factory in Grünheide, even after delays. The start of production is still planned for this July, reports the German newspaper Tagesspiegel, citing industry sources. Again, Tesla has not yet made a public statement on possibly postponed schedules. The final environmental permit for the factory from the state of Brandenburg is still pending. According to the newspaper report, a decision on this is considered possible by the end of March or April.
Tesla boss Elon Musk has long cited the supply of nickel for NMC cells or NMX cells without cobalt content as a possible bottleneck for battery supply. For this reason, Tesla also wants to offer its volume models with LFP cells, as these are cheaper, and the materials are more easily available. Cathodes with a high nickel content are to be installed in models with particularly high performance and range.
As far as nickel is concerned, there were already reports in October 2020 that Tesla was negotiating with the Brazilian mining company Vale. Now a project is apparently becoming concrete – albeit presumably in a different way than planned: According to Reuters’ report, Tesla is now acting as a consultant for a Vale nickel mine on the archipelago of New Caledonia in the southern Pacific, which belongs to France. However, Vale wants to sell this mine to a consortium. In this process, Tesla wants to advise and mediate as a potential client of the new owners. New Caledonia is the fourth largest nickel producer in the world.
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