Only a week has gone by since Elon Musk announced Tesla’s new, much-hyped Powerwall home battery on April 30, and the company is reporting that they’ve already sold out of their batteries through mid-2016, booking $800 million in revenue, according to Bloomberg. On an investor earnings call on May 6, Musk reported that the demand is so high for their batteries that in the past seven days alone they’ve taken already reservations for 38,000 home batteries and 2,500 of the larger commercial scale batteries intended for industry. Musk says that this means that Tesla will have to expand the current Gigafactory that is under construction or build another one, as the originally-planned five-million-square-foot battery factory they’re working on will not be big enough. According to Musk, the production of batteries alone will easily consume the entire capacity of the $5 billion, 50 GWh Gigafactory in Nevada, which is slated to open next year.
If these sales numbers are actually realized, it would be almost as much as the company took in from car sales in the entire first quarter of 2015. “It’s like crazy off-the-hook,” Musk said during the earnings presentation on Wednesday. “The sheer volume of demand here is just staggering.”
Of course, reservations don’t always translate into sales, and the Powerwall home battery is ridiculously easy to reserve online, requiring no credit card or financial down payment, unlike the $5,000 deposits needed for their car reservations. (I was able to reserve one in less than 30 seconds.) So is this battery going to fly off shelves as quickly as Musk seems to think?
The demand for this sort of product, which offers the promise of allowing consumers to detach from the grid and achieve energy independence, is clear. As an editor, I can tell just from Google searches and traffic around the terms “Tesla battery” how many people want this thing. And Tesla’s Powerwall batteries are priced well below competitor’s lithium-ion batteries—a deliberate strategy, it seems, to capture market share and pent-up demand.
But as any business person knows, demand doesn’t always translate into actual sales. It’s not clear how well the Powerwall battery will play with rooftop solar arrays, and even SolarCity, the solar rooftop leasing company run by two of Musk’s cousins, has decided not to incorporate the Powerwall battery into their offering. This is likely in part because of course, energy utility companies will do their best to make it difficult for consumers to achieve energy independence with a home battery, and SolarCity’s business model is predicated on working hand-in-hand with utility companies, leasing solar arrays to consumers and helping moderate energy demands for power companies.
So while 38,000+ people clearly WANT this home battery, are 38,000 consumers actually going to pony up the cash to purchase it, once they’ve crunched the numbers and compared with solar leasing options like SolarCity? That’s the billion dollar question.
What is clear is that consumers want this type of product, and this Tesla battery is going to be seriously disruptive when it comes to the home power industry. Let the energy revolution begin!
Via Treehugger, via Bloomberg News