EXCLUSIVE: Tesla Dumps $216M Into Model 3 Battery Line at Gigafactory 1

- Elon just approved the budget
for the Model 3 battery production line,
and I have an exclusive dataset
detailing exactly where they're spending their money.
Stay tuned.
Elon just approved an increase
in the overall Model 3 Module zone zero to four budget
to $216 million.
These are the lines that actually make the batteries
for the Tesla Model 3 coming up.
This is part of the overall capital expenditure
that Elon agreed to make on the Model 3 Battery Module
production line yesterday
at a meeting in the Fremont factory.
Let's take a look at the details now.
Model 3 battery production lines one, two and three
are capacitized to produce 5,000 cars per week
by running at a 61 second ideal cycle time.
That means that all three lines
are running in parallel to produce the modules
for the batteries.
So, here we have the Model 3 battery production line budget
line by line.
I've ordered them in the most expensive
to the least expensive
or the highest budget item
to the lowest budget item.
On top we have the module configuration
and at the very bottom you have the testing of the module.
The amounts here are in millions,
the capital MM is for multiple millions
and you can see that the overall budget
is $216 million.
Now, this is for all the new equipment
that they're going to install at the Gigafactory
to reach that 5,000 cars per week production target.
If we cut this data a little bit differently
you can see kind of how drastically different
the highest item to the lowest item is
with the module configuration at 42.5 million
and the module test all the way down to 1.1.
I would love to go into detail about each one of these items
but I am not a battery line production expert,
so if you are, I'd love to hear from you
and understand if there's anything
that stands out to you here.
To me, this looks like a fairly normal budget
with the surprise that the module configuration
is $12.5 million more expensive
than the next item
but again, these are the capex costs
that they're gonna use to automate
and improve the operations,
so not a big surprise
that there's some big dollar numbers here.
And lastly, I thought it would be interesting
to highlight how big some of these items are
using this heat map here
where you have the lightest color at 1.1. million
to the darkest color of the 42.5.
And again, you can see the module configuration
is the biggest one of course,
and then it kind of goes down to the right from there.
Now, during my chat with my source,
they mentioned that how they're doing it now
what the current production looks like
and this is all for the prototypes we've been seeing
and some of the battery tests
versus what it's gonna be like
with the new equipment installed.
So, currently what they're looking at
is about 20 per day that are manually built.
You have about maybe 150 employees working on this.
That's 24 hours round the clock,
12-hour shifts,
so 75 each shift essentially,
and that is extremely slow and extremely costly,
so the main idea behind this is to improve this.
Now, once you get the robots in there,
we're looking at about $216 million worth of robots,
a fair amount,
with an operating efficiency of 75%.
Now, I'm not a manufacturing expert
but it sounds like there may be some more room
to improve efficiency over time
but again, there might be kind of a golden range there.
So, if you are a manufacturing expert,
let me know what you think about that number.
Now, the way this works
and here's an example,
is cell handling.
This is the process where people take the cells
which kind of look like large double A batteries,
they are these 2170 cells from Panasonic,
and they take them out of the boxes
and they put them into the modules.
Now, the modules are what compose the battery in the car,
and so there are two employees doing this.
It takes about 10 minutes per section,
and there are seven sections per module.
A robot, on the other hand,
can do this in 10 seconds.
So, you can see it's obvious
why they're gonna be switching over
and what is actually needed
in order to accomplish this
and reach their production targets for the Model 3.
Overall, I would say that this is a good sign
that these things are in the works
and they're officially approved.
Things are gonna be ordered
and start being installed soon,
and so, if you're a Model 3 reservation holder like I am,
you're pretty excited about this,
as well as if you're a bull on Tesla like I am,
you're excited about this
because this is a good sign that they will hit
that 5,000 cars per week production target
that they've laid out previously.
So, thanks for joining me on another episode of Teslanomics,
the show where we decode the economics behind Tesla,
and if you like this, please hit the like button down below.
If you're new here, please consider subscribing
and don't forget, if you have any other questions
or anything, you can reach me at teslanomics.co.
So, thanks for joining me
and I'll see you back here next time.

EXCLUSIVE: Tesla Dumps $216M Into Model 3 Battery Line at Gigafactory 1

Latest Posts