Tesla has secured an exemption on a 10% tariff that would have applied on Japanese aluminum used in the production of battery cells at Gigafactory 1.
The exemption application shows that Tesla is planning a significant ramp up in battery production.
Tesla didn’t have much luck with its tariff exemption requests lately.
It was recently denied tariff exemptions for Model 3’s computer and touchscreen, but the automaker’s luck has turned for aluminum at least.
The automaker applied for an exemption on 10 million kg of aluminum produced by Nippon Light Metal Co that was subject to a 10% tariff that would have increased the cost of its battery cells.
Tesla argued that they couldn’t find the specific alloy in the US.
Here’s how Tesla describes the alloy:
“Alloyed Aluminum Coil, Not Backed, Slit But Still Coiled, Hot Rolled then Cold Rolled, 73MM in width, 1MM Thick, Slight Etched on splice end.”
The U.S. Commerce Department agreed with Tesla and accepted their request for a tariff waiver.
In the filing, Tesla says that it imported 6.4 million kg of the alloy per year previously, but they now plan to need 10 million kg this year – indicating a significant ramp up in battery cell production.
Earlier this year, we learn that even though Panasonic has installed battery production lines for a capacity of 35 GWh per year at Tesla Gigafactory 1 in Nevada, the battery cell production is still limited to about 23 GWh, according to CEO Elon Musk
As we reported earlier this month, Tesla all but confirmed that it’s going to make its own battery cells with its new Maxwell technology.
We should learn more by the end of the year when Tesla plans to hold a “Powertrain and Battery” investor day to talk about the latest developments on that front.
Here’s the full filing from Tesla for the tariff exemption:
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