23rd September 2020
On Tuesday, Tesla said that it was slashing battery costs to speed a global shift to renewable energy, and could have a $25 000 (about R 400 000) delf-driving model available in the next 3 years.
The average price for the current cheapest Tesla car, the Model 3, ranges from $41 000 to $50 000 (R694 735 to R847 239).
For comparison, a brand-new Nissan Navara costs about R527 300, while a brand new Toyota Corolla costs about R380 200. If Tesla manages to cut down the cost of producing its electric cars, it could become much more affordable for the average consumer.
"It is absolutely critical that we make cars that people can actually afford," said Musk.
Tesla's power team has laid out battery design, material, and production innovations that combine to cut the cost per kilowatt-hours by 56%.
The new approaches to making lithium-ion batteries would change the affordability spectrum of electric cars across the market.
Tesla investors were not happy to learn that the implementation of the cost-reduction measures would take time as the company's shares dropped about 6% in after-market trades.
This was driven by Tesla CEO Elon Musk hyping up his Battery Day event, where he said the announcements made there would be "insane."
During the said presentation, Musk and Energy Engineering senior Vice President Drew Baglino laid out technical details of Tesla's plan to change battery production, from raw materials and designed and building finished cells into the cars' frames.
While some innovations are still in development, they are eventually expected to pack more energy into battery cells while dramatically extending its life.
Musk and Baglino admitted that it would be several years before the transformative battery manufacturing tools could be integrated into mass production in Tesla factories but, they remained adamant that a shift away from fossil fuels towards sustainable energy would be a vital part of tackling climate change.