Tesla could cancel Model Y, Cybertruck 4680 battery production ramp by end 2024

Tesla has been developing its 4680 cells for use in both the Model Y and Cybertruck since 2020, and, while the EV company promised cheaper battery backs and increased production capabilities as a result of the new cell tech, that has not yet played out. Now, a report from The Information claims that Tesla's CEO, Elon Musk, has turned up the pressure on the 4680 team, setting a year-end deadline for sorting out the production ramp for the 4680 cell. 

According to two inside sources, Musk is considering scrapping the 4680 production ramp altogether if the team does not come up with a solution. Electrek reports that the dry cathode production process may be part of the problem for ramping 4680 production. Curiously, the sources cited by The Information don't directly state that the battery has no future if Musk does scrap the ramp, although it could result in significant cost changes across Tesla's EV line-up. 

At the time of writing, only the Tesla Cybertruck and some versions of the Tesla Model Y use the 4680 cells, so only those two models — one is Tesla's bestseller and the other is arguably its highest profile vehicle — will likely be affected by changes to the 4680 supply. Currently, there are other battery makers that offer 4680 cells. For instance, BYD and CATL both have their own versions of the 4680 cell, and LGES has already started pilot production of 4680 cells, while recent reports indicate that SK On, Samsung, and Panasonic are looking to start 4680 production “in the near future.” 

The biggest implication for Tesla in ditching the in-house 4680 cells for Cybertruck and Model Y production is the loss of the $7,500 IRA EV tax incentive that has made its EVs far more affordable than the competition that uses battery tech mainly sourced from China. 

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