Musk’s Big Battery Plans Could Jumpstart TSLA Stock

$Tesla (TSLA.US)$ reported positive earnings, blowing past Wall Street expectations on both top and bottom lines. While this news delighted investors, it overshadowed another key announcement. Tesla also disclosed an important battery production statistic. Nearly half the vehicles produced in 2022 Q1 were powered by lithium iron phosphate (LFP) batteries. As Reuters reports, these are a less expensive option than the popular nickel-and-cobalt-based batteries.
It’s no secret that EV producers have been concerned about battery production. The supply chain crisis was already making it difficult to procure important metals before Russia’s invasion of Ukraine. Now soaring prices of materials such as nickel have created an even more daunting industry, which isn’t helped by cobalt-mining problems.
The time is opportune for Musk to double down on EV batteries that don’t rely on either, and he is doing just that. This focus on iron-based cell batteries have earned him the title “Iron Man,” but they signal something important: that iron-based batteries are about to take over the market. As always, Tesla is leading the charge forward. Data from the Benchmark Mineral Intelligence (BMI) indicates that 44% of China’s EVs are powered by LEP batteries.
We haven’t been heavily focused on Tesla’s battery production recently, but they should be. It is an important area that promises to help the company maintain its position as leader of the EV race.