Tesla Wants To Build Its Own Battery Cells, Skunkworks Lab Already Working On It

Tesla is working towards the development of its own battery cells in a bid to reduce its dependence on Panasonic, which has been its upplier since 2014.

Citing five Tesla employees, CNBC reports that the EV maker has established its own “Skunkworks lab” for battery cell manufacturing research purposes at the Kato Road facility, just a few minutes from the Fremont factory.

Tesla and Panasonic signed an extensive partnership deal in 2014, which includes the joint ownership and operation of the battery-producing Gigafactory in Nevada.

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The Palo Alto-based car maker has been “battery-constrained” in the past, said Elon Musk at Tesla’s annual shareholders meeting in June, explaining that Tesla had to limit its production of vehicles and energy storage systems due to a lack of batteries.

Building its own batteries would enable Tesla to become as vertically integrated as possible, which is Musk’s long-held ambition. However producing battery cells at high volume is a big challenge, especially for a company that only recently took cost-cutting measures and is still trying to master high-volume vehicle production.

Nevertheless, its engineers are developing and prototyping lithium-ion battery cells, along with new equipment and manufacturing processes with the aim to produce them easily in high volumes, always according to current and former employeesy.

Even if Tesla’s battery efforts prove to be successful, though, we don’t expect them to cut ties with Panasonic and other battery suppliers. Quite the contrary, as it will most likely contract both Panasonic and LG for the battery cells that will equip the first batch of Model 3s that will come out of its Shanghai factory for the Chinese market.