In its Q1 2025 update letter, Tesla announced that all Model Y and Model 3 units delivered in the U.S. utilize 100% U.S.-made battery packs, showcasing the company's commitment to local production amidst potential auto tariffs. During the earnings call, Tesla's Supply Chain Executive, Karn Budhiraj, elaborated on the company's regionalization strategy adopted pre-pandemic and accelerated thereafter. This includes diversification and vertical integration of supply sources. CEO Elon Musk emphasized Tesla's unique positioning as a highly vertically integrated automotive manufacturer, along with advancements in lithium refining operations in Texas.
Gigafactory Nevada achieved record battery pack production. Model 3 and Model Y deliveries in the U.S. are now made with 100% U.S.-built battery packs.
Building on our efforts to reduce supply risk, we have developed our 4680 supply to ensure each component is sourced from at least two countries of origin.
That's the dream, [for] lithium batteries to not have an anode. But, there's no other car company that is building lithium refineries and cathode refineries. Were ridiculously vertically integrated.
Tesla's strategy to mitigate supply chain risks includes supply diversification, dual sourcing, vertical integration, advanced analytics, and local partnerships.
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