ColdFusion - Elon Musk: Affordable $25,000 Tesla and Better Batteries Are Coming

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Starting point is 00:01:04 Two episodes in two days. I'm very pleased that a lot of you enjoyed yesterday's episode. How interesting are the wild and surprising creative uses for AI? It was one of my favourite episodes to make, so be sure to check it out after this. So the topic in today's episode I thought was pretty important, and it had to be timely. So that's why you're seeing this second episode right after the last one.

Starting point is 00:01:25 Tesla Motors has been in the headlines for many reasons recently. from parabolic stock prices to a CEO who has extracted rage from mobs on Twitter. But in this episode, we'll take a quick look at some of the recent announcements on future plans for the company. If Tesla can actually achieve what they're talking about, it's going to take them from a specialized motor company to mainstream, all the while helping battery technology along the way. Let's take a look. You are watching Tull Fusion TV. In a Tesla event dubbed Battery Day, Elon Musk and senior vice president and engineer, Drew Baglino, described in detail a plan for a new generation of electric vehicle batteries.

Starting point is 00:02:11 And it's not a plan that rests on a single innovation, some research project that'll never see the light of day. It's a plan that has taken creative engineering and industrialization across every facet of what makes a sell into a battery pack from raw material to the finish thing. They'll be more powerful, longer lasting, and produced in-house. Musk stated that all of this will reduce costs and bring the sale price of Tesla electric cars closer in line to gasoline-powered cars. Tesla's new larger cylindrical cells, dubbed 4860, will provide five times more energy, six times more power, and a 14% reduction in price per kilowatt hour.

Starting point is 00:02:51 We are starting to ramp up manufacturing of these cells at our pilot 10 gigawatt hour production facility just around the corner. Yeah. Although prototypes are working, full production is about three years away, according to the presentation. In 2018, Panasonic battery shortages caused some delays in production. At this moment, Tesla realized that they can't rely on external partners forever. They're going to keep existing partners around for a while longer, but eventually they're going to have to do things on their own.

Starting point is 00:03:23 Elon said that Tesla will build a new plant in North America. reducing supply chain costs and simplifying cathode production. Tesla wants to do everything in-house to streamline the process from raw materials all the way to the final product. Production of battery elements is estimated to use 10 times less energy thanks to some manufacturing techniques acquired from Maxwell Technologies. It's also making improvements to the process that would make cathodes 76% cheaper and will also produce zero wastewater.

Starting point is 00:03:54 Combined efforts in streamlining the system, the production line could see a plant with an output of one terawatt hour of energy. This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to reinvent the rhythm of ad sales, using automation, analytics, and smarter workflows to simplify campaign delivery and access better data across the business. The result?

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Starting point is 00:04:58 for the Cadillac definition of luxury. In a smaller footprint, then what a plant that only outputs 150 gigawatt hours would have. More localized production is estimated to reduce the number of miles traveled from transporting materials by 80%, further saving costs and emissions. And just doing that, just localizing our cathode supply chain and production, we can reduce miles traveled by all the materials that end up in the cathode by 80%, which is huge for cost. Yeah, to be clear, cathode production would be part of the Tesla cell production plant. So then we should obviously on-site lithium conversion as well, which is what we will do

Starting point is 00:05:39 using a new process that we're going to pioneer. That's a sulfate-free process again, skip the intermediate. With all of these efforts combined, Tesla expects a 54% increase in range while reducing the cost per kilowatt hour by 56%. Range increase we're unlocking up to 54% increase in range for our vehicles and energy density for our energy products. Fifty-six percent reduction in dollars per kilowatt hour at the battery pack level. The newer batteries are expected to be in the cyber truck, roads to 2.0 and semi-truck. Vertical integration makes this all possible, allowing for more control and customization to make the

Starting point is 00:06:18 whole system as efficient as possible. An advantage I don't think many other electric car companies have right now. Tesla is also building its own cell manufacturing facility at its new factory in Germany in addition to the new plant in Fairmont, California. Tesla is also planning to eliminate the use of cobalt in its cathodes, and this is even though Tesla's existing batteries use very little. Cobalt is often mined under terrible conditions that violate human rights. The aim is to replace the cobalt with nickel for their higher quality batteries. Cobalt is also one of the most expensive battery materials, so getting rid of it will also reduce costs. Recycling the batteries was also a big part of the plan. It was stated that eventually there's not going to be a need to mine new

Starting point is 00:07:08 raw materials, as recycling existing batteries will have better yield for materials versus mining. And at that point, we have an awesome resource in those batteries to recycle, to make new batteries. So we don't need to do any more mining at that point. And you can see. see why. The difference in the value of the of the material coming back from the vehicle versus the ground, you'd always go to the vehicle. And we recycle 100% of our vehicle batteries today. Yeah. I mean, to date it's been done by third parties, but we think we can recycle the batteries more effectively, especially since our batteries, we're making the same battery as the thing we're recycling. So whereas third-party recyclers have to consider batteries of all kinds.

Starting point is 00:07:48 Elon stated that it was critical to reduce the cost of the cars. He mentioned that affordability was key to scaling. One of the things that troubles me most is that we don't yet have a truly affordable car. When you're a mid-sized business, you need every competitive advantage you can get. Like an AI solution that works for you, not against you. SAP Grow is built with AI embedded at its core, working across every system. And it's ready to go from day one so you can hit the ground running. Bring it with SAP Grow.

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Starting point is 00:08:41 and uncover generations of family stories. No experience necessary. You've got questions? We've got ancestors. Offer ends July 22nd, 2020. Visit Ancestry.ca slash beginners for details. Terms apply. Do something about this curve. The curve of the cost per kilowatt hour of batteries is not improving fast enough. We've given us a lot of thought over many years to say, okay, how can we radically improve the cost per kilowatt hour curve?

Starting point is 00:09:12 While average electric vehicle prices have been decreasing in recent years, thanks to changes in battery composition, they're still far more expensive than regular cars. It's estimated that the battery makes up a third of an electric vehicle's costs. Some researchers estimate that for electric cars to be as viable as gasoline cars, the cost of a battery pack has to be $100 per kilowatt hour. Tesla's battery packs currently cost $156 per kilowatt hour as of 2019. So efforts to reduce the cost of batteries is paramount to the long-term goal. These new batteries by Tesla will go towards building a $25,000 electric car. We're confident that long term we can design and manufacture a compelling $25,000 electric vehicle.

Starting point is 00:09:59 You know, this has always been our dream from the beginning of the company. About three years from now, we're confident we can make a very compelling $25,000 electric vehicle. That's also fully autonomous. And when you think about the $25,000 price point, you have to consider how much less expensive it is to own an electric vehicle. Yeah. So actually, it's because... becomes even more affordable at that $25,000 price point. He's expecting to have such a car available in about three years.

Starting point is 00:10:28 Tesla is usually always behind schedule, so maybe we can expect such a car in about four or five years. In the long term, the company is also targeting an annual production of 20 million vehicles, or almost twice as much as Volkswagen Auto Group sold last year, and they were the world's best-selling individual auto company. So according to Musk and Drew, all of all of all, what was said in the presentation is working in principle and on a small scale. Most of the remaining work involves scaling.

Starting point is 00:10:59 It was also announced that structural changes would be made to how the cars are actually built. Batteries will now be part of the car to save space and allow for even more battery cells. Elon has been teasing a new souped-up Model S for a while. The car will be a step above the ludicrous model. The specs are insane. It's going to have over 520 miles of range, get from zero to six. 60 in under 2 seconds and have a top speed of 200 miles per hour. In testing around the track Laguna Seeker, this new model beat the previous Tesla record by 18 seconds.

Starting point is 00:11:37 The price listed on Tesla's website is about $140,000 and it's going to be available in late 2021. So in summary, this event housed a lot of promises, 54% increased range, while reducing the cost per kilowatt hour by 56%, plus a recyclable supply chain, and minimal environmental impact is a tall order. It seems optimistic, but the Tesla team has been proving people wrong for over a decade, so if anyone can do it, it's going to be them. So I'm wishing them all the best, because ultimately such efforts are good for everyone. Though the competition is heating up with lucid air, Porsche and Rivian, all making a splash

Starting point is 00:12:20 in the electric market. But if Tesla can do what they say, this is going to put them a great deal ahead. On the flip side, Nicola Motors seems to be crashing and burning after their concept electric truck was revealed to be rolling down a hill and not actually driving, as it was misleadingly implied in an advertisement. I'm talking to some people that contributed to a scathing report by Hindenburg Research. It was picked up by CNBC and other financial media. It was the very same report that made the CEO of Nicola Motors resign. So please be patient with the production of this episode. Though do subscribe if you want to see that story.

Starting point is 00:12:56 So anyway, what do you guys think about the Tesla announcement? Are you excited? Do you think it's feasible to make a $25,000 electric car? Or are you more skeptical? Let me know in the comment section below. I'd also like to add that I don't own any Tesla stock. All right, so thanks for watching. If you do want to see anything on science, technology, business or history,

Starting point is 00:13:18 definitely subscribe to Cold Fusion. You'll find a lot of interesting stuff on you. There's going to be another episode this week, number three. Next time, we're going to look at nanoparticles that dissolve plaque in arteries and may prevent heart disease, the same topic that I mentioned at the end of yesterday's video. So stay tuned. I'll see you again next time for the next episode. Cheers, guys. Have a good one. Cold fusion. It's new thinking.

ColdFusion - Elon Musk: Affordable $25,000 Tesla and Better Batteries Are Coming

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