Report: Tesla Motors considering using more battery suppliers


Tesla Motors (TSLA) reportedly has been in discussions with South Korean firms LG Chem and Samsung SDI to help supply it with batteries for its electric vehicles.

A multi-year deal Tesla has with Panasonic (PCRFY) doesn't preclude it from using other battery suppliers.

An executive with Tesla notes it would take several years for any new supplier to be fully qualified.

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Comments (58)
  • 3D Investing
    , contributor
    Comments (1552) | Send Message
     
    Multiple suppliers = less risk

     

    This is good news. It also means that Tesla is planning on building a lot more cars than they are currently making.
    18 Nov 2013, 07:43 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    take note that dealing with more supplier is more problematic, the fact that tesla is looking for other suppliers raises question of battery issues from the last three fire accident. i was thinking that base on the last 3 accident tesla decided to find a safer battery than the current one. Tesla produce only close to 5k cars per week and i dont buy this reasoning that there are battery shortage or their current supplier can't supply enough battery for them to ramp up production.
    18 Nov 2013, 09:40 AM Reply Like
  • 3D Investing
    , contributor
    Comments (1552) | Send Message
     
    do you just read what you want to read?

     

    "An executive with Tesla notes it would take several years for any new supplier to be fully qualified."

     

    that means this is planned for several years down the road. They are talking roughly 3 years. Coincidence that genIII Model E is coming in mass production at the time? Also the same time that Tesla will be depleting its 2 billion cell deal with Panasonic?

     

    Stop spreading nonsense. It is obviously not about fires.
    18 Nov 2013, 10:00 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    really but why come up with this issue now, if what you are saying is correct Why is tesla complaining now that they dont have enough battery to ramp up production? if everything well planned in advance why come up with battery supply issues now, if tesla has the capacity to produce a lot of cars i would understand the battery supply issue, but the reality is they have the capacity to produce very few thousand cars. i am not spreading nonsense just expressing my opinion. i find it hard to understand that panasonic cant produce few thousand batteries to make Tesla happy.
    18 Nov 2013, 10:15 AM Reply Like
  • Joe Dirnfeld
    , contributor
    Comments (1124) | Send Message
     
    Pure misinformation with the intent to depress stock price
    18 Nov 2013, 10:33 AM Reply Like
  • Haeze
    , contributor
    Comments (90) | Send Message
     
    I think you have it backwards... Dealing with two suppliers, rather than one, means they can negotiate lower prices, they have more options to ramp up production quicker as needed, and the supplier no longer has control over Tesla.

     

    Any minor issues that having to deal with two suppliers may cause is FAR outweighed by the benefits of keeping your options open.

     

    This also has nothing to do with the fires, because as Elon says in every interview, the batteries did not spontaneously combust. If the cells were catching fire on their own, he might look to replace the manufacturer, but the truth is, the cells were critically damaged in an accident. If this were a recall-worthy event, then all cars with gas tanks would have to be recalled due to the 20,000 gasoline car fires every year (many of which aren't even caused by an accident).

     

    Stop spreading FUD. It only makes you less credible.
    18 Nov 2013, 10:55 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    last week morgan and morgan filed class action lawsuit againts tesla related to battery and this morning i saw another one filing in relation to tesla gaap earnings report. i was hoping that in the future some of you will not file lawsuit againts tesla because looks like you trusted and invested a lot in tesla stock.
    18 Nov 2013, 11:26 AM Reply Like
  • surferbroadband
    , contributor
    Comments (5121) | Send Message
     
    Not 20,000 car fires a year, more like 200,000 car fires a year. In 2011 there were 187,500 car fires and 270 deaths.
    18 Nov 2013, 12:00 PM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    Panasonic have traditionally made small, lithium ion batteries for small electronic appliances - NOT elecric vehcicles requiring hundreds of them in a 'battery pack' PER SINGLE VEHICLE. This is why there is a LONG TERM "shortage" of these types of batteries. Tesla is piggybacking on Panasonics existing small cells and joining them into a large 'pack' and thus Panasonic was not prepared to supply anything more than about it's current demand for small batteries, all used in small appliances only. Tesla is one of the safers cars in the world, so you don't know what your talking about.
    18 Nov 2013, 04:09 PM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    this will mean tesla is trying to fix its battery fire problem...how come they are not doing a recall
    18 Nov 2013, 09:27 AM Reply Like
  • evalcrux
    , contributor
    Comments (180) | Send Message
     
    Because there is not a battery fire problem
    18 Nov 2013, 09:33 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    if there is no battery problem why look for other supplier? tesla produce very few cars per week like close to 5k...most of the time manufacturer look for other supplier because they are not happy with the quality of the parts they are getting. how can they say it is a supply issue if Tesla is only producing or has the capacity to produce only few thousand cars per week...
    18 Nov 2013, 09:48 AM Reply Like
  • 3D Investing
    , contributor
    Comments (1552) | Send Message
     
    "if there is no battery problem why look for other supplier?"

     

    The news clearly stated that it takes years to qualify the supplier. You don't fix a current problem in years. What kind of backward thinking is this.

     

    In the latest CC and interviews Elon clearly stated that he is looking for other suppliers for GenIII Model E because Panasonic does not have the capacity for them to produce 300k vehicles a year. This news goes right in line with what he's saying.

     

    Tesla also announced it would be looking for multiple suppliers to lower its risk of supply interruptions. This was months ago.
    18 Nov 2013, 10:03 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    why tesla talk about panasonic cant do 300k battery per year, tesla only produce few thousand cars per month means 24k per year..i. dont get this. with all the competition coming from Bmw, ford, gm....And with tesla's limited networks of service centers and distributors They should not talk about these huge big tesla demand in the coming years...it will not happen, many of these talks is just meant to support its bubbled stock price..
    18 Nov 2013, 10:35 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    save your money tesla will go down below $50 and will go under once competition starting to catch up by next year...the problem with tesla is that they dont have the network to support its "Dream expansion"...mass production of EV will be done by more capable manufacturer like toyota, bmw, gm, ford nissan, not by tesla.
    18 Nov 2013, 10:46 AM Reply Like
  • Haeze
    , contributor
    Comments (90) | Send Message
     
    @redsstock
    Answer a question for me; If someone were to take a regular 12v car battery, and hit it with an axe causing it to split open and splash acid on the person, would you say that battery manufacturer needs to recall their product ?

     

    How about if someone dropped a glass jar and it broke ? Does the jar manufacturer have to recall every glass jar they made ?
    18 Nov 2013, 11:05 AM Reply Like
  • AlexiaEP
    , contributor
    Comments (1074) | Send Message
     
    "if there is no battery problem why look for other supplier?"

     

    Just in case you actually care about facts....

     

    This news feed is a regurgitation of OLD news. Tesla was already in talks with LG and Samsung MONTHS BEFORE the Model S accidents, that saw a small portion of their batteries catch fire.
    18 Nov 2013, 11:16 AM Reply Like
  • Tales From The Future
    , contributor
    Comments (7574) | Send Message
     
    " why tesla talk about panasonic cant do 300k battery per year,"

     

    That contract is over 4-5 years and will cover Model S and X, not per year.

     

    Investors should learn about the worldwide global supply limit in 18650 batteries.

     

    TSLA currently can't produce more cars (even if demand is there) because of this critical path.

     

    TSLA bulls who think battery supply is no issue and will require no more major investments from TSLA will find out more over the coming years...it won't be good news.
    18 Nov 2013, 11:19 AM Reply Like
  • Stephen Pace
    , contributor
    Comments (805) | Send Message
     
    @redstock: We know how long it takes for the big manufacturers to come up with new vehicles and have pretty good visibility a few years out. So far, no manufacturer has anything that can touch Model S or Model X. Certainly not a BMW i3 or i8. The longer the EV drought goes, the better Model E looks.
    18 Nov 2013, 11:33 AM Reply Like
  • AlexiaEP
    , contributor
    Comments (1074) | Send Message
     
    "TSLA bulls who think battery supply is no issue and will require no more major investments from TSLA will find out more over the coming years...it won't be good news."

     

    Let me make an equally speculative statement and state it as if it were fact:

     

    TSLA bears who think battery supply will be an issue once Panasonic finishes reopening and developing the new lines (Spring 2014 - as has been reported) they've committed to and that Tesla won't be able to find a partner to bare the brunt of future costs for a giga factory will find out more over the coming years...it won't be good news.
    18 Nov 2013, 02:17 PM Reply Like
  • Tales From The Future
    , contributor
    Comments (7574) | Send Message
     
    @Alexia: You left out what I had written before: Yes, the new contract with Panasonic covers the Model S and X.

     

    But the elephant in the room is battery supply for the Gen III car and the huge investments needed.

     

    I think this will require 5-10 billion USD, details in my Instablog.

     

    If you think that's not needed or as easy as finding some additional suppliers in Asia, run the numbers again - either that or there will be less Gen III cars than bulls model in for 2017+.
    18 Nov 2013, 04:14 PM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    Their "network" will cover almost the entire United States by the end of the year, so stop talking rubbish. Toyota, BMW, GM don't want to eat into their regular ICE vehicle sales too much... so I say - what threat???!!!
    18 Nov 2013, 04:16 PM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    True, I do recall that happening way back.
    18 Nov 2013, 04:17 PM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    ...and you don't think think other suppliers would love to invest a lot, knowing they have a market selling new batteries to Tesla? Even if Tesla had to invest in a huge battery factory, long term it would be a worthy investment. No more battery middlemen, all profit to Tesla on battery sales and car sales as well!!!!!
    18 Nov 2013, 04:21 PM Reply Like
  • AlexiaEP
    , contributor
    Comments (1074) | Send Message
     
    "But the elephant in the room is battery supply for the Gen III car and the huge investments needed.

     

    I think this will require 5-10 billion USD, details in my Instablog."

     

    And I think you're wrong. First, on the actual cost and second your assumption that Tesla will bear the entire cost.
    18 Nov 2013, 05:41 PM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    There is a problem, there isn't a problem. Lots of opinions.

     

    TSLA continues its slide this morning.

     

    The market is speaking.....anyone listening?
    18 Nov 2013, 09:46 AM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    Yes, of course, TESLA got a problem : TOO MANY CUSTOMERS DEMANDING THE CAR ALL OVER THE WORLD, please sell me more of your shares, at a cheaper price. This is a perfect oppportunity to BUY the shares of disrupting company, led by a visionary leader
    18 Nov 2013, 10:12 AM Reply Like
  • Tales From The Future
    , contributor
    Comments (7574) | Send Message
     
    How can you sell more cars when there are no batteries beyond the current limits?

     

    It will take years to solve this problem (and I'm not even talking about demand).
    18 Nov 2013, 11:22 AM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    please look by yourself at the transcript of the earnings call, THERE ARE ENOUGH BATTERIES to execute the planned increases of their production for the next TWO YEARS. They are planning the battery supply for the production of 500 000 cars per year in three years. These are the great news: the demand for cars is very strong and the management team is excellent, since they are planning things well in advance
    18 Nov 2013, 11:36 AM Reply Like
  • stvrob_63
    , contributor
    Comments (1133) | Send Message
     
    Why don't they just put an internal combustion engine in it until they get the battery thing worked out.
    18 Nov 2013, 03:33 PM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Thank you stvrob. Made my day.
    18 Nov 2013, 03:34 PM Reply Like
  • Tales From The Future
    , contributor
    Comments (7574) | Send Message
     
    TSLA ICE? Hell freezes over first ;)

     

    PS: @volsh: I'm talking about battery supply and investments/risks for Gen III.
    18 Nov 2013, 04:24 PM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    It will also take years for battery supply issues to become a problem for Tesla. Start looking at both sides of the story for once.
    18 Nov 2013, 04:24 PM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    Because they are selling a decent amount of cars right now...
    18 Nov 2013, 04:26 PM Reply Like
  • joenjensen
    , contributor
    Comments (701) | Send Message
     
    That's right, these guys never stop looking for an excuse to downgrade Tesla, either because they are employed in ICE or they are shorting the stock, take your choice.
    20 Nov 2013, 12:02 PM Reply Like
  • JWS0711
    , contributor
    Comments (3) | Send Message
     
    @redsstock ... your math must be pretty horrendous. TSLA makes ~ 550 cars per week not 5,000. If they were producing the volume you suggest then they would exceed the volume of supply of batteries from Panasonic this year (1.8B) that they have contracted for over the next three years. (@7,000 cells/car) Simply repeating the words Tesla and fire over and over again does not make the cars any bit less than the safest tested...ever.
    18 Nov 2013, 10:16 AM Reply Like
  • redsstock
    , contributor
    Comments (629) | Send Message
     
    you are right only 550 cars means few thousand cars per month.
    18 Nov 2013, 10:25 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi Volsh,

     

    I guess there's always a first time. Can't recall a stock plummeting over 1/3 in a fortnight because it's got too much business.

     

    Is Tesla trying to revolutionize stock trading and car buying?

     

    TSLA broke below $130 his morning. Is anyone willing to step up?

     

    Talk is cheap.
    18 Nov 2013, 10:18 AM Reply Like
  • Stephen Pace
    , contributor
    Comments (805) | Send Message
     
    @Reel Ken: I think the primary reaction today is with regard to legal challenges:

     

    Pomerantz Grossman Hufford Dahlstrom & Gross
    Morgan & Morgan
    Levi & Korsinsky

     

    Ambulance chasing at its finest. My hope is these lawfirms lose their shirts on this, although unfortunately Tesla legal doesn't appear to have that great of a track record so far.
    18 Nov 2013, 11:43 AM Reply Like
  • EVfan12
    , contributor
    Comments (912) | Send Message
     
    Ever heard of profit taking? Even Tesla can't go up forever!!!
    18 Nov 2013, 04:31 PM Reply Like
  • googlepeakoil
    , contributor
    Comments (10) | Send Message
     
    Breaking news - flammable things catch fire! Petrol catches fire, so does diesel, and so do lithium batteries. There really isn't any news. I read about a car that a petrol tanker overturned on - the people in the car if they weren't crushed died a horrible death. Cars do catch fire. I don't think Tesla's catch fire - and most cars don't know they've caught fire, tell you to pull over, come to a controlled stop and let you get out of a fire-barried shell and walk away from the vehicle before smoking and then catching fire after a few minutes. Also as batteries/electric motor is 90% efficient (compared to about 20-25% for a ICE) the actual energy in a fully charged Tesla is equal to 2 gallons of gasoline. Basically - far less fuel.
    18 Nov 2013, 10:39 AM Reply Like
  • Dampflok
    , contributor
    Comments (1380) | Send Message
     
    Diesel does not catch fire, its pretty difficult to ignite with a match!
    18 Nov 2013, 12:56 PM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    I'm buying some more shares at 130, and will do the same at 120, if I get an opportunity, all this stupid media story of two fires has nothing to do with the big global innovative trend. By the way speaking about charts the strong uptrend on the monthly chart is intact
    18 Nov 2013, 10:40 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi Volsh,

     

    Gee, guess you should have waited. TSLA went to $128 and broke support at $128.25.

     

    How's the $130 buy looking?

     

    The good news is that you may not have to wait too long to execute the second part of your plan and buy at $120.
    18 Nov 2013, 10:47 AM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    you must've learned charts way too long time ago. Nowdays it is a basic thing that the support is a ZONE, never the exact price. I'm buying because I see only limited downside risk. The only real "bad news" was the profit taking after the earnings, this had already been more than fully priced) All the "bad things" had already happened, In the long run the price will only go higher
    18 Nov 2013, 11:02 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    HI Volsh,

     

    TSLA now down to $123 and falling. Hmmmm... my broken support level at $128.25 seems to be working better than your "zone support".

     

    What are your charts telling you now? I have a chart that says when one buys at $130 and it goes to $123, they lost $7/share. Ouch !!!! ----- 4 hours big loss.

     

    On the positive side, your planned for $120 buy is getting closer.

     

    Other TSLA bulls have blogged that they are waiting for $100 to jump in.

     

    Me, I'm on the sidelines. It will be ripe for investment once all the TSLA-ite bloggers capitulate. It looks like that time is arriving faster than expected.

     

    ,
    18 Nov 2013, 02:42 PM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    HI volsh,

     

    Get ready, TSLA down to under $122.

     

    Your golden opportunity to buy at $120 is getting closer.

     

    Shame about the $130. Keep the faith, me, I'm keeping the money.
    18 Nov 2013, 03:19 PM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi volsh,

     

    Hope you're there. TSLA at $120.09. Get ready.

     

    Sooner than expected.

     

    Roy Orbison...

     

    "Tender nights before they fly
    Send falling stars that seem to cry
    Your baby doesn't want you anymore

     

    It's over"
    18 Nov 2013, 03:29 PM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    HI volsh,

     

    Did your buy get triggered, before the bounce? TSLA hit $119.68.

     

    Wow, who would have thought you'd hit the trifecta...

     

    1) Watch your current TSLA drop 11%,

     

    2) Get to buy at $130,

     

    3) Get to buy again, at $120

     

    ALL IN ONE DAY.

     

    Congrats.
    18 Nov 2013, 03:39 PM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    Hi Reel, I 'm surprised to see so many talking from you, since I've already answered to your remarks with the proposed bet below. Again, my plan is very simple : I do not have time to perfectly time the market for the TESLA bounce. I'm buying in small chunks, at no more than 5% of the total of my planned position in Tesla. Tesla will recover as there is no issue with the number of people wanting their cars, nor with execution of their plan. They are actually ahead of their plan on the number of vehicles produced. One last thing, which seems to be not quite well understood yet by the investor's community, is the perception of the TESLA's brand by the general public. Every time somebody buys a car it is always a statement about himself. In this transition time to the new technological age more and more successful people do not want to be associated with old brands, for them TESLA is not just another car company, it is THE car from the SILICON VALLEY. And if it is adopted as such by the new elite, all the others will follow. To how many millions of customers this will translate? The high probability of this scenario is not fully priced to my opinion
    19 Nov 2013, 09:17 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi volsh,

     

    Everything you say, has been said before. It was said when TSLA was at $194, when it was at $155, when it was at $140 and at $130.

     

    I repeat, TSLA is an irrational stock. It does not trade on fundamentals, it trades on fear and hope.

     

    Your "bet" expresses exactly what Tesla bulls are all about. They are making a bet .... a gamble. Maybe the bet will pay off, maybe it won't. Maybe I win the lottery, maybe I don't. That's what it comes down to.

     

    All this talk (whether by longs or shorts) is just talk. It's the same type of jabbering that goes on in sports bars while the game is on. Only there's less drinking .

     

    So stop trying to make believe what just isn't there. Watch the game, as I do, and enjoy it. But remember. the outcome is determined on the field, by those with a lot more muscle than you'll ever have.
    19 Nov 2013, 09:47 AM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    Hi, Reel. Taking into account the emotions of the crowd is one of the parts of my strategy, that is why I was buying when there was fear. However
    I disagree on the total irrationality. There is a very rational story, the technological trend against which everybody, with whatever muscle it might has, is weak. By the way my two buys with average price of 125 are already positive. How about your short? Did you have time to cover?)
    19 Nov 2013, 10:17 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi volsh,

     

    Glad you made. I caution it is only made when it is sold. Hope it works for you.

     

    I have repeatedly stated that I have no position in TSLA...long or short. TSLA is a gamble, not an investment. I make my money investing.

     

    I hope you're better at "..playing the emotions of the crowd.." than you are in figuring out what I plainly say.
    19 Nov 2013, 11:09 AM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    Hi Reel. If you do not have a position, why are you spending so much time watching the exact tesla stock price moves and sending so many comment about it, sounds strange...) I hope you are doing some online degree course, say on artificial intelligence), at the same time, while watching the price moves of tesla. Don't forget that time is your most valuable asset
    19 Nov 2013, 11:37 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi volsh,

     

    Watching the bull/bear fight on TSLA is entertainment value to me.

     

    Some watch boxing or wrestling or Honey Boo Boo.

     

    I am retired, independently wealthy and have more than enough time to devote to my investments. I also am an accomplished author, specializing in options strategies. I do this to pass some of my knowledge/experience to the less-well informed.

     

    Are you appointing yourself the "entertainment sheriff" ?
    19 Nov 2013, 04:02 PM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi volsh,

     

    That's what everyone says when their position declines.

     

    This is a classic battle of technical vs. fundamentals. Let's see who wins.
    18 Nov 2013, 11:06 AM Reply Like
  • volsh
    , contributor
    Comments (27) | Send Message
     
    Hi Reel, OK, let's have a bet, which thing will happen first: the price will double from here, and stay above that, i.e. $260, for more than one month, OR it will go below half of the price, $65 and stay there for more than one month.
    18 Nov 2013, 11:47 AM Reply Like
  • Reel Ken
    , contributor
    Comments (6582) | Send Message
     
    Hi volsh,

     

    I think you'd have to put a time frame on it. Then I'll bet you a large sum of money and buy puts or calls to arbitrage my bet.

     

    That's how one makes money when they come across people that feel that a "bully bet" is worthwhile.

     

    I have stated many times that TSLA is an irrational stock and it's anyone's guess where it will go. If I was willing to bet you, then I'd be willing to go long or short, and I'm not willing to.

     

    I deal in the moment, and the moment has TSLA below $127.
    18 Nov 2013, 12:03 PM Reply Like
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