Tesla Motors and their battery supplier, Panasonic, announced on Wednesday an agreement in which Panasonic will expand supplies of automotive-grade lithium-ion battery cells to Tesla. This expands on their 2011 agreement, and under the new agreement Panasonic will supply over 2 billion cells over the next four years. The cells will be used in both the Model S and Model X.
Tesla Motors' electric cars are built with cylindrical format lithium-ion cells with over 7,000 cells per battery pack. This is unlike other electric car makers whose battery packs use larger cells in what's called the prismatic format. Best estimates are that in 2013 Tesla will build 1.6 gigawatt-hours of battery packs for Model S production, and that during 2014 this demand will double. By 2017 production of the Model S and Model X is projected to reach 100,000 cars per year, and by then Tesla's affordable mass market electric car should begin production at the 200,000+ car per year level.
Clearly, Tesla Motors' plans to expand electric car manufacturing is going to stress the lithium battery industry production capacity.
Recently it had been disclosed Tesla Motors and Samsung were testing Samsung's cells. Earlier this month Tesla spokesperson Liz Jarvis-Shean confirmed Tesla and Samsung were in discussions, but that Tesla talks with every battery maker. "We continually evaluate best (battery) cells and technologies from all manufacturers," Jarvis-Shean said.
That deal, if it goes through, was supposed to have Samsung supplying cells for the Model X. That car is due to begin production in late 2014. However the new announcement from Tesla and Panasonic says Panasonic will be supplying cells for both the Model S and Model X.
“This expanded agreement with Panasonic is important to Tesla as we continue to increase the pace of production,” said Tesla Co-Founder and CEO Elon Musk. “We look forward to strengthening our relationship with Panasonic, and I’m confident that this partnership will continue to be an integral part of Tesla’s success for years to come.”
“We are extremely proud to be a strategic partner of Tesla,” said Yoshihiko Yamada, president of the Automotive & Industrial Systems Company, an internal company of Panasonic. “Panasonic will increase its production capacity of lithium-ion battery cells to supply Tesla’s growing needs as it expands its production of EVs.”