Here's the Biggest Risk With Tesla's Gigafactory

[BlueStreak]

16. Did he say they would al be Teslas?

Maybe I didn't read carefully enough. A battery factory of that scale could certainly supply product to other manufacturers. There is a fundamental problem. Li-Ion is not progressing very fast. There are some incremental increases possible with better packaging but basically WYSIWYG. There isn't a n order of magnitude available. A full order of magnitude is not necessary to make an all electric car viable for the non-enthusiast. But certainly a 3:1 improvement is needed, and that is 8 years off in the most optimistic case, and realistically a 2:1 improvement may be the end of the line for that technology.

If that is true, then there won't be demand for 500,000 cars a year that produce range anxiety. But his batteries most certainly could be used in hybrid packages, especially in combination with fuel cells or other technologies like micro-turbines. This guy is plenty smart to get deals that leave all the risks in the hands of others. He will structure it such that he doesn't suffer if the plant never reaches the scale he is boasting about. If he can produce batteries economically, he'll do fine.