Tips, Tricks & Trends

Tesla Wants to Supply Batteries to Rivals

People often think of Tesla as an auto manufacturer. But the company does a lot more than produce vehicles. The company also makes solar roofing tiles, and was also recently in the news for applying to get a license as an energy provider. So, it should come as no surprise that Tesla also wants to get into the battery production industry on a much larger scale than it does now. However, what might surprise people is how it plans to do than.

A charcoal Tesla Model 3 electric car in a showroom
The Model 3 electric car from Tesla stands in a showroom | Photo by Christophe Gateau/picture alliance via Getty Images

Tesla wants to supply rivals with batteries

Tesla has big plans for battery production. Those plans include supplying rivals with batteries. Teslarati tweeted about an article that claims German automakers are trying to make up the multiyear gap in battery technology that Tesla is ahead on. Surprisingly, co-founder and CEO of Tesla, Elon Musk replied, “Tesla is open to licensing software and supplying powertrains & batteries. We’re just trying to accelerate sustainable energy, not crush competitors!” That tweet is below.

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Why would Tesla supply rivals?

Many may ask, why would a company do anything to help competitors? The news of helping rivals should not be all that shocking. From the beginning, Elon Musk has been on a mission to help the world find sustainable technologies. His goal is targeted for mankind, not Teslakind. He has even gone so far as to open source all of the company’s patents. Then he declared that to the world in an interview on the 60 Minutes news television show. See tweet below.

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Somehow, Tesla shareholders are okay with open-sourcing patents and sharing technology with competitors. This can be attested to because current share prices have made the company one of the most valuable automakers in the world. Also, nobody seems to be crying foul.

Not the first time for Tesla to share battery tech

Indeed, Tesla has partnered up with Toyota in the past on a limited run of Rav4 models. The company also had an agreement with Mercedes back in 2008. So, the idea is not new. 

Things are not as they seem, however. Earlier this week, Tesla went after Rivian, another electric vehicle manufacturer for allegedly stealing employees who were in positions to transfer trade secrets. If Tesla’s patents are truly open-source, then how can the automaker justify the lawsuit? Let that irony percolate for a little bit.

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Batteries are not inexpensive

Here is the bottom line, battery technology is not inexpensive. Yet, the reality is that Elon Musk has found ways for his company to make it work. Other manufacturers want to catch up with what Tesla has learned. In the meantime, the California manufacturer has a great opportunity to become a supplier of electric battery powertrains for those companies that don’t want to learn the technology on their own. That’s a supplier business that could be lucrative for Tesla if enough auto manufacturers sign up. 

Nowhere does it say that Tesla is only an automotive manufacturer. It can also be an automotive industry supplier if it wants to be. Sharing battery technology may only be the first step to moving the world forward with electrification. What if the company became an electric powertrain manufacturer that anybody could call up and place an order from for their vehicle? Branching out is possible.