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Tesla Gigafactory will begin Model 3 battery cell production in Q2

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Tesla announced today that it has begun mass production of lithium-ion battery cells to be used in the company’s line of energy storage products and the much anticipated Model 3 sedan, from its Gigafactory battery plant in Sparks, Nevada.

A tour of Tesla’s Gigafactory last summer showed that the company was already building high performance ‘2170’ battery cells in conjunction with strategic partner Panasonic from the $5 billion battery facility. The new cell format, 21 millimeters in diameter and 70 millimeters long, provides significant improvements in energy density over the more traditional 18650 cells currently being used on its fleet of vehicles.

“The high performance cylindrical “2170 cell” was jointly designed and engineered by Tesla and Panasonic to offer the best performance at the lowest production cost in an optimal form factor for both electric vehicles and energy products.” says Tesla through a press release.

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Inline with our recent report that the Gigafactory has completed construction on new sections on the north and south ends of the main building – as seen through a drone flyover video – and effectively doubling the size of the plant, Tesla announced through today’s press release that its current structure is nearly 30 percent done.

“Already, the current structure has a footprint of 1.9 million square feet, which houses 4.9 million square feet of operational space across several floors.” says Tesla, adding, “we are still less than 30 percent done. Once complete, we expect the Gigafactory to be the biggest building in the world.”

Drone video of Tesla’s Gigafactory shows the battery factory more than doubling in size

Tesla is taking a phased approach with building out additional sections at the Gigafactory so that Panasonic and other partners operating within the facility can begin manufacturing immediately inside completed areas. The process will allow the company to maintain a high level of efficiency as it learns from the build-out of each zone, and improve on its “construction and operational techniques” in an effort to ultimately drive down the cost of energy storage.

“With the Gigafactory online and ramping up production, our cost of battery cells will significantly decline due to increasing automation and process design to enhance yield, lowered capital investment per Wh of production, the simple optimization of locating most manufacturing processes under one roof, and economies of scale. By bringing down the cost of batteries, we can make our products available to more and more people, allowing us to make the biggest possible impact on transitioning the world to sustainable energy.”

With nearly 400,000 reservations placed on Tesla’s upcoming mass market Model 3, which the company says through its website will see first deliveries beginning at the end of this year, mass production of 2170 battery cells couldn’t be more important. Tesla will likely provide additional insight on Model 3 progress as it closes the first quarter and begins production on vehicle components including the battery pack for its affordable long-range electric car.

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Tesla rolls out most aggressive Model Y lease deal in the US yet

With the promotion in place, customers would be able to take home a Model Y at a very low cost.

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(Credit: Tesla)

Tesla has rolled out what could very well be its most aggressive promotion for Model Y leases in the United States yet. With the promotion in place, customers would be able to take home a Model Y at a very low cost.

Zero downpayment leases

The new Model Y lease promotion was initially reported on X, with industry watcher Sawyer Merritt stating that while the vehicles’ monthly payments are still similar to before, the cars can now be ordered with a $0 downpayment. 

Tesla community members noted that this promotion would cut the full payment cost of Model Y leases by several thousand dollars, though prices were still a bit better when the $7,500 federal tax credit was still in effect. Despite this, a $0 downpayment would likely be appreciated by customers, as it lowers the entry point to the Tesla ecosystem by a notable margin.

Premium freebies included

Apart from a $0 downpayment, customers of Model Y leases are also provided one free upgrade for their vehicles. These upgrades could be premium paint, such as Pearl White Multi-Coat, Deep Blue Metallic, Diamond Black, Quicksilver or Ultra Red, or 20″ Helix 2.0 Wheels. Customers could also opt for a White Interior or a Tow Hitch free of charge.

A look at Tesla’s Model Y order page shows that the promotion is available for all the Model Y Premium Rear-Wheel Drive and the Model Y Premium All-Wheel Drive. The Model Y Standard and the Model Y Performance are not eligible for the $0 downpayment or free premium upgrade promotion as of writing. 

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Tesla is looking to phase out China-made parts at US factories: report

Tesla has reportedly swapped out several China-made components already, aiming to complete the transition within the next two years.

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(Source: Tesla)

Tesla has reportedly started directing its suppliers to eliminate China-made components from vehicles built in the United States. This would make Tesla’s US-produced vehicles even more American-made.

The update was initially reported by The Wall Street Journal.

Accelerating North American sourcing

As per the WSJ report, the shift reportedly came amidst escalating tariff uncertainties between Washington and Beijing. Citing people reportedly familiar with the matter, the publication claimed that Tesla has already swapped out several China-made components, aiming to complete the transition within the next two years. The publication also claimed that Tesla has been reducing its reliance on China-based suppliers since the pandemic disrupted supply chains.

The company has quietly increased North American sourcing over the past two years as tariff concerns have intensified. If accurate, Tesla would likely end up with vehicles that are even more locally sourced than they are today. It would remain to be seen, however, if a change in suppliers for its US-made vehicles would result in price adjustments for cars like the Model 3 and Model Y.

Industry-wide reassessments

Tesla is not alone in reevaluating its dependence on China. Auto executives across the automotive industry have been in rapid-response mode amid shifting trade policies, chip supply anxiety, and concerns over rare-earth materials. Fluctuating tariffs between the United States and China during President Donald Trump’s current term have made pricing strategies quite unpredictable as well, as noted in a Reuters report. 

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General Motors this week issued a similar directive to thousands of suppliers, instructing them to remove China-origin components from their supply chains. The same is true for Stellantis, which also announced earlier this year that it was implementing several strategies to avoid tariffs that were placed by the Trump administration. 

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Tesla owners propose interesting theory about Apple CarPlay and EV tax credit

“100%. It’s needed for sales because for many prospective buyers, CarPlay is a nonnegotiable must-have. If they knew how good the Tesla UI is, they wouldn’t think they need CarPlay,” one owner said.

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Credit: Tesla Raj/YouTube

Tesla is reportedly bracing for the integration of Apple’s well-known iOS automotive platform, CarPlay, into its vehicles after the company had avoided it for years.

However, now that it’s here, owners are more than clear that they do not want it, and they have their theories about why it’s on its way. Some believe it might have to do with the EV tax credit, or rather, the loss of it.

Owners are more interested in why Tesla is doing this now, especially considering that so many have been outspoken about the fact that they would not use it in favor of the company’s user interface (UI), which is extremely well done.

After Bloomberg reported that Tesla was working on Apple CarPlay integration, the reactions immediately started pouring in. From my perspective, having used both Apple CarPlay in two previous vehicles and going to Tesla’s in-house UI in my Model Y, both platforms definitely have their advantages.

However, Tesla’s UI just works with its vehicles, as it is intuitive and well-engineered for its cars specifically. Apple CarPlay was always good, but it was buggy at times, which could be attributed to the vehicle and not the software, and not as user-friendly, but that is subjective.

Nevertheless, upon the release of Bloomberg’s report, people immediately challenged the need for it:

Some fans proposed an interesting point: What if Tesla is using CarPlay as a counter to losing the $7,500 EV tax credit? Perhaps it is an interesting way to attract customers who have not owned a Tesla before but are more interested in having a vehicle equipped with CarPlay?

“100%. It’s needed for sales because for many prospective buyers, CarPlay is a nonnegotiable must-have. If they knew how good the Tesla UI is, they wouldn’t think they need CarPlay,” one owner said.

Tesla has made a handful of moves to attract people to its cars after losing the tax credit. This could be a small but potentially mighty strategy that will pull some carbuyers to Tesla, especially now that the Apple CarPlay box is checked.

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