Cobalt Excitement Rises as Tesla Begins Model 3 Battery Production

All eyes are once again on Tesla (NASDAQ:TSLA) as the company prepares to launch its new electric car model next month.
Most recently, JB Straubel, Tesla’s chief technical officer, said that lithium-ion battery production for the Model 3 is underway “right now.” Speaking at an Energy Fair last weekend, Straubel said the Model 3 will use “2170 cells.”
Tesla and its partner Panasonic (TSE:6752) have been producing the cells at Tesla’s Nevada-based gigafactory since January, but until recently they were all being used in second-generation powerwalls and powerpacks. The batteries, so named because they measure 21 millimeters by 70 millimeters, have been described by Tesla CEO Elon Musk as “the highest energy density cell in the world, and also the cheapest.”
The company is aiming to raise its annual electric vehicle output to 500,000 cars by 2018, and is mass producing lithium-ion batteries to power them. By next year, Tesla’s gigafactory is expected to have a battery production capacity of 35 GWh per year, nearly as much as entire rest of the world combined.