Tesla battery supply chain diversification yields positive results

One of the biggest bottlenecks for automakers as they transition from internal combustion engine (ICE) vehicles to those with electric motors is being able to source enough electric vehicle (EV) batteries to meet demand.

Even Tesla has not been immune to this problem over years, but has attempted to mitigate it by diversifying it battery supply chain to include the likes of CATL and LG Chem.

Those efforts have paid off and for the first time in several years, the company has enough battery supply for both its automotive and energy businesses.

That is according to Martin Viecha, Tesla’s Vice President of Investor Relations, who made the comments at a Goldman Sachs conference in San Francisco on Monday.

“For the first time I can remember, we can access all the supply we need for both businesses,” Viecha said (via Business Insider).

Viecha said that their suppliers are not slowing down either, adding that they are building extra capacity “super fast” to manufacture more cells for Tesla.

And Tesla isn’t resting on its laurels with Viecha predicting the company will be adding more suppliers as they continue to grow and expand production. That expanded production will involve both vehicles and battery energy storage systems.

Tesla now has four Gigafactories up and running with an installed production capacity of around 2 million vehicles.

Tesla is also significantly ramping up production of Powerwalls and Megapacks. At Giga Nevada they are currently producing around 42 Megapacks and 6,500 Powerwalls each week at Giga Nevada.

Megapack production will increase even further with Tesla’s new Megafactory coming online, which is targeted to produce 40GWh of Megapacks per year.

According to Viecha, Tesla uses 90% of its battery supply for its automotive business, with the remaining 10% being reserved for its energy business.

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