Tesla Increases the Price of the Powerwall as Demand Greatly Outpaces Production
October 12th, 2018Disclosure: I sell solar power systems in New Zealand.
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I wrote a comment on Tesla and the Powerwall a few days ago:
I can’t personally speak to the quality of Tesla’s vehicles, but I’ve had a Powerwall 2 at home since the end of June and, as a working professional in the solar + storage industry, I can assure you that the Powerwall 2 lives up to the hype. From the physical build quality to the performance to the app integration, everything else looks stupid. My criticisms of the product (there are a few) are noise level relative to what it’s doing for us.
The media doesn’t focus much on storage, but Tesla could do vastly more business in that area if they had the cells to spare.
Via: Electrek:
When we talk about Tesla being production constrained, we most often talk about the company’s vehicles. But the Powerwall, Tesla’s home battery pack, might be its most production constrained product.
Now, the company has significantly increased Powerwall’s price just as it is expected to ramp up production.
Powerwall availability has been limited in many markets and many reservation holders have complained about the lack of communication about a timeline to get the energy storage device.
One of the greatest features of the Powerwall has been its price, which is significantly lower per kWh than the competition.
But now the automaker is increasing the price of the device by a significant amount.
Tesla updated the Powerwall page on its website today with a $1,200 price increase between the actual battery pack and the supporting hardware:
Powerwall went from $5,900 to $6,700
Supporting hardware went from $700 to $1,100
The price increase follows another smaller price increase earlier this year.
So why do you think that storage prices are going up while solar panel prices and electric car prices are going down?
There’s no competition to the Powerwall. The Powerwall is about 3 years ahead of the rest of the industry. Tesla is raising the price because they can. I’m guessing that the higher prices will do roughly nothing to ease demand.
Most of the Model 3 vehicles that Tesla is selling are festooned with high profit margin options, so the cell lines are going to definitely prioritize vehicle production. Tesla/Panasonic are in the process of bringing more cell production capacity online. Tesla’s storage prices will go back down again at some point.
Eventually, someone will be able to compete with Tesla. Hint: It will have to be a company that’s making their own cells at an astonishing scale, or some wildcard, disruptive technology.