Not just cars. Tesla, which produces and sells new energy vehicles, has recently transformed into a "catfish" and entered the new energy storage industry.
According to the official WeChat account of the Lingang New Area Management Committee of the China (Shanghai) Pilot Free Trade Zone (hereinafter referred to as the "Shanghai Lingang Management Committee Official WeChat") on May 13th, the construction permit for Tesla's Shanghai Energy Storage Super Factory project has been issued.
This is Tesla's first energy storage super factory project outside of the United States. Near Tesla's Shanghai super factory.
According to Xinhua News Agency, Min Zhiguang, Deputy Director of the Approval and Review Center of Lingang New Area and Head of the Project Construction Service Office, said that the Tesla Shanghai Energy Storage Super Factory project has applied the "Project Service Package" newly launched by Lingang New Area in the field of engineering construction. Specifically, it is to embed the entire service system into the approval process from the project perspective and specific scenarios, and to put enterprise and government matters into one "package" before the start of the project, and to develop a node flow chart from the project perspective.
"Through the design of service packages, enterprises can quickly obtain relatively accurate and comprehensive government service and management requirements from the earliest stage when their investment intentions are not fully clear, achieving seamless integration throughout the entire process. Especially when encountering problems, there is no need to separate this department or that department, but a complete set of mature 'zero time difference' response and problem-solving mechanisms." Min Zhiguang said.
According to the plan, Tesla's Shanghai Energy Storage Super Factory will achieve mass production in the first quarter of 2025. The initial plan for the energy storage super factory is to produce 10000 commercial energy storage batteries annually, with an energy storage capacity of nearly 40 gigawatt hours (GWh, gigawatt hours: 1 gigawatt hour=1000 megawatt hours). Each commercial energy storage battery can store over 3 megawatt hours of energy, suitable for multiple scenarios such as renewable energy systems and peak demand management.
According to data from GGII, the shipment volume of energy storage lithium batteries in China in 2022 was 130 GWh, which means that the production capacity of Tesla's super energy storage factory is equivalent to one-third of China's 2022 shipment volume of energy storage lithium batteries.
Tesla's energy storage super factory is not only an important optimization of the company's global production layout, but also will assist in the development of Shanghai's new energy storage industry and green and low-carbon transformation. It is reported that the total area of the project is about 200000 square meters, with a total investment of approximately 1.45 billion yuan.
The official WeChat account of the Shanghai Lingang Management Committee stated that in the future, Tesla's Shanghai Energy Storage Super Factory will produce ultra large commercial energy storage batteries (Megapacks) to help power grid operators, utility companies, and others store and distribute renewable energy more efficiently. More than 200 ultra large commercial energy storage batteries (Megapacks) can form an energy storage power plant, storing 1 million kilowatt hours of electricity.
The layout of Tesla, the first energy storage super factory project outside the United States, can be traced back to a year ago.
According to First Financial, on April 9, 2023, Tesla signed a contract with Lingang New Area for the Tesla Energy Storage Super Factory project. On December 22 of that year, Tesla held a land acquisition signing ceremony with the Lingang New Area Management Committee in Shanghai, announcing the start of the Tesla Energy Storage Super Factory project.
Not only does it produce and sell new energy vehicles, but the industry also refers to Tesla as the "catfish" of the new energy storage industry. It is reported that Tesla's Megapack, which will soon be manufactured in Lingang, Shanghai, can store over 3.9MWh of energy per unit, meeting the hourly electricity demand of 3600 households and the needs of large-scale power projects ranging from 1MWh small microgrids to GWh+.
According to the "2024 Global Energy Storage Industry Development Blue Book" released by the industry consulting firm Qidian Research Institute, the global shipment volume of lithium-ion energy storage systems in 2023 was about 192GWh, with the top five companies in terms of shipment ranking being Sunshine Power, BYD, Tesla, CRRC Zhuzhou Institute, and Fluence, with Tesla ranking third.
In recent years, Tesla's energy storage business has grown rapidly.
According to Pudong's official WeChat account, starting in 2015, Tesla has launched products such as Megapack and Powerwall in the United States, targeting the large industrial and commercial energy storage and household energy storage markets, respectively. Tesla's energy storage products are currently distributed in over 65 countries and regions worldwide, with over 1500 operational sites. The headquarters has a deployment volume of over 10 gigawatt hours (GWh), with huge market demand. In 2023, Tesla's total installed energy storage capacity reached 14.7 gigawatt hours (GWh), a year-on-year increase of 125%, more than twice that of 2022. The company's energy generation and storage business profits almost quadrupled in 2023. The installed capacity in the first quarter of this year reached a record high of 4.1 GWh.
Tesla's Q1 2024 Financial Report
The rapid growth in installed capacity of energy storage products is also reflected in the financial statements.
In 2023, Tesla's gross profit from its energy generation and storage business reached $1.141 billion, almost four times that of the previous year ($288 million). The company expects that the installed capacity of energy storage will continue to grow in the future, and the revenue from energy storage business is expected to exceed that of vehicle business.
Meanwhile, on April 24th Beijing time, Tesla released its Q1 2024 financial report, stating that its energy generation and storage business achieved a historic high of 1.635 billion yuan in revenue, a year-on-year increase of 7%.
"For many years, I have predicted that the growth rate of the energy storage business will be much faster than that of the electric vehicle business, and it is being realized," Musk said during the 2023 fourth quarter financial report conference call
Regarding the development of energy storage, Tesla previously stated in an interview with Shell Finance: "For Tesla, electric vehicles are the fundamental carrier for application, and their purpose is to integrate key technologies in the fields of electric vehicles, energy storage products, artificial intelligence, and robotics, forming a closed loop of software and hardware integration."
Tesla Ecosystem Tesla Q1 2024 Report
Why did Tesla choose to build factories in China for energy storage layout?
According to a report by Shell Finance in April this year, Wang Peng, an associate researcher at the Beijing Academy of Social Sciences, told reporters that China, as the world's largest market for new energy vehicles and a potential energy storage market, provides Tesla with broad development space. In addition, China has significant advantages in the battery supply chain, and Tesla can use this system to increase production and reduce costs.
Renowned strategic positioning expert and founder of Fujian Huace Brand Positioning Consulting, Zhan Junhao, stated in an interview with reporters that Tesla's decision to build a factory and expand its energy storage business in China is mainly based on multiple considerations. Firstly, China has a well-established automotive industry and supply chain, which provides Tesla with high-quality and low-cost components and services. Secondly, China's investment environment and policy incentives provide convenience and guarantee for Tesla's factory construction. China's energy storage market has enormous potential. As the world's largest new energy vehicle market and the most promising energy storage market, China is an important strategic area for Tesla to promote global green and low-carbon transformation.
Wang Peng analyzed that the energy storage market is currently in a rapid development stage, and with the popularization of renewable energy and the increasing demand for grid stability, the demand in the energy storage market will continue to grow. This market not only involves international giants like Tesla, but also numerous domestic enterprises actively laying out and developing. These enterprises enhance their competitiveness through technological innovation, product upgrades, and market expansion. With the continuous development and growth of the market, competition will become more intense.
Tesla's entry into the domestic energy storage industry in China will intensify competition in the energy storage market, but it will also drive the development and innovation of the entire industry. Tesla's technology and brand influence will have a profound impact on the market landscape.
Zhan Junhao also mentioned that for domestic energy storage peers, Tesla's entry will undoubtedly intensify market competition. Tesla's technological advantages and brand influence may give it a certain market share, putting pressure on existing energy storage companies. However, this will also promote technological progress and industrial upgrading in the domestic energy storage industry, enhancing the competitiveness of the entire industry. As for the extent of the impact, it still depends on Tesla's specific performance in the Chinese market and the response strategies of domestic enterprises.
Daily Economic News Comprehensive News from Xinhua News Agency, First Financial (Reporter: Lu Ruyi), Shanghai Lingang Management Committee Official WeChat, Pudong Release, and Beike Finance (Reporter: Lin Zi)