On Monday, EV truck maker Nikola announced the resignation of Trevor Milton, its embattled CEO. This outcome was highly predictable after the release of Hindenburg Research’s scathing short-seller report.
Milton is walking away with $3.1B (92m shares of $NKLA), per CNBC. But, with the stock down 19% on Monday, he might be losing a comma soon.
THE BIG IDEA
What to expect from Tesla’s Battery Day
Tesla’s annual shareholder meeting is today. However, the real show will be the carmaker’s reveal of its new battery technology (AKA Battery Day).
To grasp the significance of Battery Day, The Hustle spoke with Omar Qazi, a software engineer and prominent Tesla writer.
(So prominent, in fact, that $TSLA short sellers are currently suing Qazi along with Elon Musk).
Tesla wants to make 20m cars/year…
… from a 500k delivery goal for 2020.
To do so, it’s vital that the electric vehicle (EV) maker can create an affordable battery.
Qazi tells us that a gas car costs about $125 per kWh. Once battery tech improves to that range of energy efficiency, the case for gas cars will not be great.
“Batteries are the largest cost of an EV,” Qazi says. “If EVs hit $100 per kWh, we’re talking about an option that is cheaper than a gas car, has less maintenance, and doesn’t pollute. That would be the tipping point for mass adoption of EVs.”
Such battery tech would usher in a new energy paradigm
Clean energy (wind, solar) has an infinite supply but — in industry parlance — it is intermittent. The sun doesn’t always shine, and wind doesn’t always blow.
The right battery tech provides a cost-effective way to store renewable energy.
“Renewables are incredibly cheap,” Qazi says. “We’re talking as low as $0.02 per kWh. The key is matching demand with supply. A cheap enough battery can help facilitate this need and, ultimately, replace all fossil fuel plants.” (Here’s one recent example in the UK.)
Will Tesla make its own battery tech?
At present, Tesla has a number of partnerships with the likes of Panasonic and LG Chem to manufacture batteries (Gigafactories).
“Tesla is probably making their own battery cell,” Qazi posits. “They want technology that can best integrate with their software and achieve the maximum battery life with the best performance.”
While Qazi expects Tesla to maintain its battery partnerships, the most viable way for the company to achieve its mass production targets is to control the battery tech from A through Z.
That very well could be today’s announcement.
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