Elon Musk: ‘Hundreds of gigafactories needed to meet EV demand’

Tesla Motors founder Elon Musk has said he anticipates the need for 200 high-capacity battery factories to cater for future automotive demand.

Speaking at the World Energy Innovation Forum, Musk also said that estimates that Tesla’s own ‘gigafactory’, which is due to become operational in 2017, would reduce the cost of lithium-ion battery cells by more than 30 percent may be modest.

“I think we can probably do better than 30 percent,” Musk said, speaking at Tesla’s Fremont plant in California. “We are making a humongous factory. There will be other companies besides us and Panasonic. So far it’s looking good. We’re building a gigafactory because we can’t think of any other way to scale.”

Musk intends for Tesla to meet a large proportion of future demand for electric cars, and the company will launch a more affordable car to coincide with the first battery packs leaving its new $5 billion gigafactory. This smaller version of the Model S is expected to cost between $35,000 and $40,000 while boasting a 200-mile range. Reducing the cost of lithium-ion batteries will integral to its success.

Before then Tesla will launch its first SUV – the 2015 Model X – which will be based on the underpinnings of the Model S but with four-wheel drive and seven seats as standard.

Tesla will shortly announce the location of its first gigafactory, and two states will be shortlisted from an original choice between Arizona, New Mexico, Nevada, and Texas. Once that is decided, Musk will move as fast as possible to get the plant, which will become the largest of its kind, operational.