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Q-1) Should Tesla have taken a partner for its new Shanghai facility?

If so should it have been a battery supplier? If so


which battery suppliers could be potential partners?

ANS-1) Yes Tesla should have taken a partner for its new Shanghai Facility i.e Gigafactory -3, as they have less time
of 3 years to start the production of cars with an initial annual capacity of 250000 vehicles and also they were
producing the EV in tie-ups with Panasonic Corporation in America(Nevada and Buffalo). Panasonic being a world
leader in battery technology were manufacturing the batteries , which is the most critical component in electric
vehicles. This partnership has also resulted in many significant mutual benefits earlier. Battery account for over one
third of the total vehicle price. So partnering with a battery supplier would lessen the production burden on the EV
manufacturer. Previously Tesla had earned huge benefits from its supply contract with Panasonic, which reduced
uncertainities in the supply of batteries. The partnership also provided the opportunity to drive down the unit price
of batteries by 30 percent.

Yes, it should be a battery supplier as battery is the most critical component in electric vehicles and account for over
one third of the total vehicle price, so the battery should be of very high quality and that too with a low price range
as compare to others. In my views Tesla should partner with Panasonic as done in the case of Gigafactory-1 &2.
Because of their mutual understanding and Tesla’s backward integration Panasonic was able to get visibility and
market reach in America and Tesla in Asian markets.

The battery suppliers which could be potential partners are as follows:

1. Panasonic Corporation : With a global market share of 21% and looking at the familiarity with Tesla this
could be vital potential partner.
2. CATL
3. BYD Auto
4. LG Chem Ltd
5. Samsung

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