Panasonic is betting that near a century of expertise making automotive batteries has ready it to fabricate a difficult-to-produce next-generation battery championed by Tesla as the important thing to unlocking cheaper and extra ubiquitous electrical automobiles.

Tesla CEO Elon Musk first unveiled the 4680 battery at Tesla’s Battery Day in September as a “huge breakthrough” in cell expertise that may make it doable for his firm to supply EVs that promote for $25,000, roughly a 3rd lower than Tesla’s most elementary Mannequin 3.

Whereas Tesla plans to make the cells in-house, it has additionally requested its oldest battery provider, Panasonic, to start producing them as effectively.

The catch: the thicker and extra voluminous 4680 cells, named after their dimensions of a 46-millimeter diameter and 80-millimeter peak, are nonetheless largely unproven. Business specialists even query whether or not the batteries, which resemble a downsized model of the aluminum cans used for sodas and beer, are doable to mass produce.

“There are vital technological points to get previous, points that many within the business have been making an attempt to sort out for years,” stated Ram Chandrasekaran, a transportation and mobility analyst at Wooden Mackenzie. “If achievable, these battery cells could be groundbreaking. However the jury’s nonetheless out on whether or not they’re deliverable.”

Panasonic says it could be best-positioned to see the difficult new cells to market. Proper now, the Japanese electronics maker is working to arrange a prototype manufacturing line for exams.

“Producing these bigger cells requires you elevate your craftsmanship one or two full ranges or there might be questions of safety,” Yasuaki Takamoto, Panasonic’s EV battery head, stated in an interview. The corporate’s time-tested safety-management techniques “completely give us an higher hand right here,” he stated.

A lot of the good thing about the brand new 4680 cells comes from the truth that they’re greater than 5 occasions the dimensions of the smaller 1865 and 2170 cells Panasonic at present provides to Tesla. Because of this the standard 4,000 to eight,000 cells present in an EV at present may be diminished to round 500, which, in flip, means fewer elements resembling bonding items used to string particular person cells collectively. New cell shapes such because the 4680 are “key to creating extra inexpensive EV fashions which might be able to meaningfully spreading,” stated Akira Nagasaki, technical technique head on Takamoto’s group.

The bigger capability, nonetheless, can also be what makes the cells tougher to supply. They’re vulnerable to overheating as a result of it’s troublesome to disperse warmth from their middle. They’re additionally extra inclined to particle contamination, a frequent reason behind EV battery fires that happens when minuscule metallic items discover their manner into the middle of a cell, inflicting it to short-circuit, in response to Takamoto.

In contrast with different EV battery heavyweights, Panasonic has been gradual to construct scale, as a substitute touting the security benefit of its batteries and increasing manufacturing solely at a tempo at which it might probably keep security requirements, Takamoto stated. The identical know-how that lets Panasonic produce 2.5 billion cells a 12 months with out main questions of safety additionally offers it a bonus in producing the 4680 cells, he stated.

Tesla and Panasonic’s push to develop next-generation batteries comes as just about all automakers jostle to safe their very own provide of the core part. Batteries are essential to differentiating automakers’ fashions because the business as an entire shifts to EVs, stated Wooden Mackenzie’s Chandrasekaran.

“It’s a pivotal second,” he stated.

Fearing future shortages, carmakers resembling Volkswagen Group are demanding extra batteries and even pushing to fabricate their very own. This has led to notable stress between automakers and their suppliers, as battery makers hesitate to spend money on new capability based mostly solely on buzzy future gross sales projections, Chandrasekaran stated.

That wrestle is clear within the improvement of the 4680 cells. Musk, who’s set a particularly formidable objective for Tesla to supply 20 million EVs a 12 months by 2030, plans to make the cells in-house and can also be reported to be speaking to battery makers aside from Panasonic. Panasonic, in flip, says it’ll search to promote the batteries to EV makers different than simply Tesla.

However the next-generation expertise additionally underscores the potential for mutual advantages if automakers and battery suppliers are capable of develop particular applied sciences at present that may allow them to journey the wave of rising EV gross sales collectively sooner or later.

Musk himself acknowledged the problem of mass producing 4680 cells when talking at a European battery convention in November. Tesla had produced the battery at a “bench-top stage” and was aiming to have it at “pilot-plant stage” quickly, however “scaling up the manufacturing course of is far more durable than proving one thing out on a lab bench,” Musk stated.

Panasonic has been mass producing lithium-ion batteries for automobiles since 2010 — across the similar time its greatest battery-buyer was simply launching its preliminary public providing.

“Working with a accomplice like Panasonic that has in depth expertise in large-scale cell manufacturing will enhance the probability of Tesla reaching the targets the corporate outlined at its Battery Day occasion,” BloombergNEF analyst James Frith wrote in a observe printed shortly after Panasonic’s CFO introduced the corporate was engaged on the brand new 4680 cell in October.

For Panasonic, the 4680 battery that Tesla requested it to supply is a possible supply of progress because it seems to be to scale back its reliance on its once-core client electronics enterprise. Bearing in mind the variety of EVs Musk needs to see out on roads and demand from different automakers as effectively, if Panasonic decides to maneuver ahead with producing 4680 cells “we are going to accomplish that on a big scale,” Takamoto stated.