Tesla partners with BYD's FinDreams for energy storage Megafactory in Shanghai

Max McDee, 05 June 2024

Tesla is expanding its energy storage business in China by partnering with BYD's battery-making unit, FinDreams. This is Tesla's first venture into energy storage manufacturing outside the US, with the new Megafactory being built in Shanghai.

The Megafactory, located in the Lingang area of Pudong, Shanghai, will focus solely on producing Megapack, Tesla's large-scale energy storage system for office buildings and factories. While CATL has been Tesla's primary supplier of energy storage cells, FinDreams is now set to join it, securing over 20% of orders. This points to Tesla's desire to diversify its supply chain and foster competition.

Tesla partners with BYD's FinDreams unit for energy storage Megafactory in Shanghai

This is a significant collaboration for both companies. For Tesla, it means a more reliable supply of battery cells at competitive prices by enlisting yet another supplier. At the same time, FinDreams gains a high-profile client, boosting its credibility and market presence.

The Shanghai Megafactory, scheduled to start production in the first quarter of 2025, has an ambitious target of producing up to 10,000 Megapacks annually, equivalent to 40 GWh of energy storage. This substantial capacity highlights the growing demand for energy storage solutions, particularly in China, where renewable energy sources like solar and wind power are rapidly expanding.

Tesla partners with BYD's FinDreams unit for energy storage Megafactory in Shanghai

FinDreams' involvement in this project is a testament to its technological prowess and a reflection of BYD's broader strategy to diversify its business portfolio. While BYD is best known for its electric cars, the company has been steadily expanding into other areas, including energy storage, solar panels, and electric buses.

Tesla decided to partner with FinDreams after switching its energy storage system cells from lithium ternary batteries to more cost-effective lithium iron phosphate (LFP) batteries in 2021. This move aligns with Tesla's ongoing efforts to reduce costs and make its products more accessible to a wider audience.



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