Elon Musk
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  • Tesla CEO Elon Musk said the company plans to build an electric van “at some point,” but has been held back by battery-cell production constraints.
  • The company is trying to overcome low output volumes by making its own cells.
  • Musk has been talking about making an electric van for years, but other automakers like Ford and Mercedes have beat him to it.
  • Visit Business Insider’s homepage for more stories.

Tesla plans to build an electric van, but don’t expect to see it on the road anytime soon.

CEO Elon Musk said the company plans to build it “at some point,” but has been held back by battery-cell production constraints.

“The thing to bear in mind is that there is fundamentally a constraint on battery cell output,” Musk said during the earnings call. “The main reason we have not accelerated new products is … that we simply don’t have enough cells built.” 

For many future Tesla products – especially those like the van or the company’s semi-truck, which require more battery cells than a regular vehicle – battery cell volume remains one of the primary roadblocks. 

Read more: Elon Musk’s move to Texas is a publicity stunt that reveals how Tesla is maturing as an automaker

"It's really hard to appreciate just how hard it is to scale production," Musk said during the conference. "Prototypes are easy. Scaling production is very hard."

Tesla is working with several battery partners, including Panasonic and LG, as well as on its own battery-production facility in order to increase the number of available cells.

Musk said that by making its own cells the company is trying to overcome shortages in the market.

"The reason Tesla is doing its own cell production is in order to accelerate the growth," Musk said. "We've been very clear with our cell suppliers … we will take as many batteries as they can produce."

As one of the most expensive elements of the car, Musk has long been looking for ways to make batteries cheaper and easier to produce. He has also worked to provide incentives for a more robust battery supply chain. 

On Tesla's Battery Day in September, Musk announced several efforts the company was making to allow for faster and cheaper cell production. He said the company would start its own lithium mine, as well as make a "4680" battery pack - a product that would produce six times the power of a regular battery. 

The SVP of Powertrain and Energy Engineering, Andrew D. Baglino, said during the meeting the company would soon reach its goal of higher production.

"We've developed enough engineering confidence with our 4680 design and the production process and equipment to kick off manufacturing equipment and facility construction to support our 100 gigawatt hour 2022 goal," Baglino said.

Musk has been talking about making an electric van for years. In 2018, he tweeted the company would be interested in working with Mercedes on the project.


Tesla could be a latecomer to the electric-van scene; companies like Mercedes, Ford, and Rivian have already started working on electric vans.

Mercedes plans to sell a fully electric version of its Sprinter van in the US starting in 2023, while Ford unveiled its E-transit electric cargo van in November. General Motors announced plans to roll out electric vans in January. 

See also: Early Rivian investors explain the 3 factors that could make the Amazon-backed startup the next Tesla

Last year, Amazon ordered a fleet of custom delivery vehicles from EV company Rivian. Amazon plans to have a fleet of 10,000 electric vans on the road for delivery purposes by 2022.

On Wednesday, Tesla continued its winning trend, posting another quarterly profit to close out 2020 with its first profitable fiscal year.

The company debuted a new Model X Plaid and updated Model S during the earnings presentation. Musk also revealed plans to potentially start delivering the Cybertruck near the end of 2021, though volume production is expected to begin in 2022.

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