Shares of electric cars leader Tesla (TSLA -1.05%) jumped in early trading Monday after its car battery partner Panasonic announced it will produce Tesla's new 4680 lithium ion batteries at a production facility in Japan -- perhaps in as little as one year from now.
Tesla stock is up 4.7% in response as of 10:25 a.m. ET.
The 4680 is a new kind of lithium ion battery, first revealed at Tesla's Battery Day presentation in 2020. Reuters notes that at a diameter of 46 millimeters (mm) and a height of 80 mm (hence the name), the new battery will be about five times bigger than Tesla's current battery cells. At that size, the new battery will not only be able to hold significantly more energy but also provide greater range to Tesla's vehicles and at lower production cost.
Of course, first Panasonic needs a factory capable of producing the thing. As Reuters reported early this morning, Panasonic needs to build two new production lines at its Wakayama factory in western Japan before it can begin production. The Fly notes that production won't begin before "the fiscal year ending in March 2024."
The good news is that "the fiscal year ending in March 2024" is also the fiscal year that begins in March 2023 -- so, technically, it's possible Tesla could start getting its new batteries as early as one year from now. The bad news is that the way Panasonic seems to be describing its plans, it's more likely to take a bit longer than that -- perhaps twice as long, or two full years.
The best news of all, however, is simply that the new battery is no longer vaporware. Sooner or later, this new battery will arrive and extend Tesla's technological lead over other electric carmakers even further.