Currently reading: Tesla reveals new battery tech that will enable affordable EV
Pioneering firm says radical battery developments will allow sub-£20,000 electric car - but not until 2022

Tesla boss Elon Musk says the firm is working on a new generation of electric vehicle (EV) battery that will provide five times more energy and cost half as much as existing technology – but added that it's at least three years away from production.

Musk said the new battery system, which uses larger cylindrical cells and will be produced in-house by Tesla, will enable the firm to launch an “affordable” $25,000 (£19,500) electric car, although he added "serious high-volume production" of that machine won't be possible until 2022.

Developing such a car, which Musk promised would be able to “drive itself”, has been a long-held ambition for the American firm.

Musk made the announcement at a much-hyped Battery Day event, during which Tesla also revealed the specs of the range-topping Model S Plaid.

“We need to make more affordable cars,” said Musk. “One of the things that troubles me the most is that we don’t have a truly affordable car, and that's something we will have in the future. For that, we need cheaper batteries.”

Tesla has been aiming to develop a battery that costs $100 (£77) per kWh, down from around £115-£150/kWh at the moment. The firm is now developing technology using continuous cylindrical cells, as opposed to the ‘tabs’ of today.

The spiral design of the new batteries makes them cheaper to produce and, Tesla says, enables them to offer five times the energy, 16% more range and six times the power of the current battery pack used in the Model 3 and Model Y.

While Tesla currently buys batteries from suppliers including Panasonic, CATL and LG Chem, it's aiming to start producing the new batteries in-house, which would also greatly reduce the cost. It will continue to buy batteries from outside firms to meet its demand, though.

Tesla also said that it's developing systems to recycle battery cells, developing its own “inexpensive” silicons and aiming to slash the use of cobalt in its batteries, which will also further reduce costs.

It intends to start pilot production of the new battery at its factory in Fremont, California, but Musk said it would take at least a year to reach full production capacity.

By producing its own batteries, Tesla says it will be able to integrate the packs more fully into the structure of future cars and pack them in more densely. It said that will reduce the car’s mass by 10% and boost range by 14%, which will be key in achieving the cost savings needed to produce what Musk said will be a “compelling” affordable EV.

The announcement disappointed some investors, due to pre-event suggestions that Tesla was going to unveil a ‘million-mile’ battery, prompting the firm’s share price to fall 5.6% by the close of trading in the US on Tuesday.

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It continued to fall in after-hours trading, dropping Tesla’s market cap by around $50 billion (£39.3bn).


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James Attwood

James Attwood, digital editor
Title: Acting magazine editor

James is Autocar's acting magazine editor. Having served in that role since June 2023, he is in charge of the day-to-day running of the world's oldest car magazine, and regularly interviews some of the biggest names in the industry to secure news and features, such as his world exclusive look into production of Volkswagen currywurst. Really.

Before first joining Autocar in 2017, James spent more than a decade in motorsport journalist, working on Autosport,, F1 Racing and Motorsport News, covering everything from club rallying to top-level international events. He also spent 18 months running Move Electric, Haymarket's e-mobility title, where he developed knowledge of the e-bike and e-scooter markets. 

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spqr 23 September 2020

Wishful Reporting

Read the reports in the business press not gullible Autocar. No new battery technology was"revealed" rather Mr Musk set out a series of ambitions to aim for. One example is the lithium clay process that Mr Musk put at the centre of his ambition for Tesla to make their own batteries and reduce or remove cobalt from the batteries.  This process does not actually exist and simply a theory set out by another company looking to get investment from Tesla. . Autocar really need to use some scepticism from time to time. 

Peter Cavellini 23 September 2020

No point.

 Certainly in the UK the number of charging points would have to be installed faster, or, if Tesla could come up with a home charger in some way, then, the sub £20K car would be a can do.

Torque Stear 23 September 2020

I love that the stock market

I love that the stock market were disappointed because Tesla didn't unveil a "million mile battery".

Despite the fact that such a thing is totally feasible with current technology, just not desirable as you compromise or cost, energy density and power.

To gain a durability that would outlast the car.

What they actually unveiled is very clever and going to be difficult for others to replicate if they keep being dumb customers.