Tesla Previews Next-Generation Batteries; Says 2020 Deliveries Will Rise 30-40%

Tesla's batteries are touted as cheaper and more powerful, but won't go into mass production for a while.
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Tesla is building new battery models that promise better performance at less cost that will lead to less expensive electric vehicles, the company announced at an event Tuesday. 

At a "Battery Day" event, which was preceded by a Tesla shareholder meeting, Tesla founder and CEO Elon Musk showed off a larger car battery cell, called the 4680, that will generate six times more power, five times more energy and 16% more driving range, all at about 14% lower cost.  

Tesla  (TSLA) - Get Report shares rose briefly during the presentation, but were overall roughly flat in after-hours trading. 

Tesla plans to produce the new battery cells initially at a pilot site in its main Fremont, Calif. factory, with planned output reaching 10 gigawatt hours (GWh) by the end of 2021.

Musk said the cheaper and more efficient batteris will ultimately let Tesla "make a compelling $25,000 car that's fully autonomous."

The new batteries will take a while to ramp up, however: Tesla said that the 4680 batteries won't reach mass production until 2022, and plans to be producing 100 GWh. It aims to produce 3 terawatt hours (TWh) by 2030. 

Just before the battery presentation, Musk also hinted at Tesla's delivery guidance, saying that he expects vehicle deliveries this year to grow by 30% to 40%. An increase of 30% to 40% above 367,500, Tesla's 2019 delivery result, would mean 477,750 and 514,500 vehicles. The company told investors earlier this year that it will deliver 500,000 vehicles in 2020. 

Musk also said that it's rebooting Autopilot, with a new private beta version coming in “I think a month or so” according to Musk.  

"We had to do a fundamental rewrite of the entire Autopilot software stack," he said.

For more on Tesla, check out Tesla Maven Rob Maurer.