:Perhaps the biggest hurdle Tesla faces in its goal to build an affordable electric car is the cost of batteries that eliminate the need for gasoline. To deal with the problem, Elon Musk’s upstart automaker is planning to build a “Gigafactory” — a huge factory that by 2020 would exceed 2013 global production of battery packs.
In a release today, Tesla explained the goal of the new factory:
The Gigafactory is designed to reduce cell costs much faster than the status quo and, by 2020, produce more lithium ion batteries annually than were produced worldwide in 2013. By the end of the first year of volume production of our mass market vehicle, we expect the Gigafactory will have driven down the per kWh cost of our battery pack by more than 30 percent.
In 2013, the first full year of Model S production, Tesla accounted for more than a third of the industry’s battery usage. The company now works with Panasonic to produce the batteries that power the Model S, but Musk said in an earnings call earlier this month that he expects to have more than one partner on the Gigafactory.
The automaker will directly invest $2 billion into the project, and partners will provide another $2-3 billion….”Twitter