Sustainability Profile Tesla

About Tesla

Tesla’s Mission: Accelerate the world’s transition to sustainable energy generation, storage, and supply.

While attempting to do the right thing, Tesla is designing and manufacturing a complete energy and transportation ecosystem. Major auto manufacturers ignored the warning flags up until roughly five years ago since the transition to electrifying everything seemed to be little more than a passing trend. Now that zero emissions targets must be met by all nations, many observers are perplexed as to why Tesla dominated the transition to all-electric vehicles. Sales of legacy auto companies' petrol and diesel models are plummeting, and so have their margins and cash flows. Tesla is leading the industry into an electric future.

Tesla product lineup

This includes products catering to electric energy generation, storage, supply, and transportation.

Tesla Impact

This section discusses how Tesla improved different processes and products to make them more sustainable.

Tesla EVs vs Equivalent ICE vehicles — Lifecycle Analysis and Emissions per mile

The table shows lifetime fuel consumption and use-phase emissions of Greenhouse gases –

Compared to GHG-emitting alternatives, the environmental impact of zero-emission transportation and energy products, such as those that Tesla manufactures and sells, is indisputable to be more favourable. This is especially true when comparing the lifetime effects of EVs and ICE vehicles, which necessitates considering all aspects of the lifecycle rather than just emissions produced during vehicle operation. Currently, the Model 3 and Model Y’s manufacturing process produces slightly more greenhouse gas emissions than a comparable combustion engine vehicle. However, after travelling 6,500 miles, the Model 3 and Model Y have fewer lifetime emissions than an equivalent ICE according to the global weighted average grid mix.

ICE vehicles’ efficiency does not improve throughout the course of their lifetime. Also, the carbon impact of ICE vehicles remains the same every year of use, but for EVs, it should improve every year. As the grid grows more environmentally friendly, EVs will get cleaner over time. Through solar and storage products as well as software to help distinguish when the grid is more environmentally friendly and utilizing more renewable energy sources, such as solar or wind, Tesla will continue to look for ways to enable their customers to further reduce their emissions outside of their vehicles. By combining onsite resources with yearly renewable matching, the Tesla global Supercharger network became 100% renewable in 2021.

Improved Powertrain Efficiency — Reduced Carbon Footprint

Tesla was able to reach an energy efficiency of 3.1 EPA miles/kWh in the early stages of Model S production. Tesla reduced its carbon footprint further by improving its powertrain efficiency. Tesla vehicles are among the most efficient EVs built to date. The Model Y All-Wheel Drive (AWD) is the most cost-effective electric SUV yet made, with 4.1 EPA miles per kWh. When compared to rivals in the same market segment, the efficiency gap between Tesla AWD vehicles continues to be noticeable. Their AWD vehicles can accelerate to 60 mph in only 4.2 seconds and can achieve a top speed of 145 mph while maintaining the best energy economy in their class. Tesla has been able to make cars with high efficiency without compromising on their performance which is best in class.

New, Better designed, more efficient and sustainable factories

Since Tesla initially bought an existing automotive factory in Fremont and repurposed it to create electric vehicles, it wasn’t the most efficiently laid out factory. In every new factory Tesla built after that, sustainability was kept in mind and it reduced energy use. The different stages involved in the manufacturing process were more tightly integrated like an integrated circuit in an electronic chip which resulted in a decrease in energy utilization, and fewer robots employed to produce vehicles as each component required less travel throughout the factory.

Also, to lower the need for heating and cooling at Gigafactory Texas, they selected windows that are extremely efficient, insulated, and have low emissivity. Furthermore, waste heat recovery from just their compressors will compensate for over 1 MW of natural gas used for process heating.

Roof space covered with solar panels

New Tesla factories are all intended to have solar panels on top of them. They have 21,405 kW worth of solar panels installed as of the end of 2021. As space permits and as is economically possible, they plan to continue to expand their solar capacity.

Leveraged AI to make factories more efficient

Tesla trained an AI software to properly operate 195 interconnected HVAC units, totalling 6MW of electrical demand, using sensor data collected over six years from the Gigafactory Nevada. They observed a sizeable load reduction in its first full year of operation when compared to baseline usage. As AI control is scaled up to control a majority of the HVAC equipment at Gigafactory Nevada as well as HVAC equipment at other Giga factories, Tesla expects to save a considerable amount of energy.

Advancements in battery technology

Tesla introduced a revolutionary technique for making cells (4680 Tesla cells) utilizing a dry electrode approach at Tesla’s 2020 Battery Day. The current methods for making electrodes require coating and drying them using large machinery after combining liquids with cathode or anode powders. Today’s cell manufacture uses a lot of energy because it requires huge ovens. According to most recent studies, the novel dry-electrode technique enables a straight switch from a cathode or anode powder to an electrode film, lowering energy usage in the whole cell manufacturing phase by more than 70%.

More efficient localized factories reduced waste generated per vehicle

Many components had to be sent from vast distances since the automotive supply chain didn’t have a significant presence on the West Coast of the United States; this necessitates extra packaging and generates more trash than is necessary. As Tesla built more factories, their waste per vehicle decreased. It realized that it is both economical and waste-reducing to construct localized factories (created factories closer to the customers — China, Europe, and North America). Tesla recycles all materials that are possible to recycle. Just 7% of the total trash produced at Gigafactory Shanghai in 2021, for instance, was not recyclable.

Reduced water used per vehicle manufactured by process optimization

Tesla withdrew less water per vehicle produced at facilities specifically for vehicle manufacturing than the majority of well-established automakers. Water for thermoelectric power is used to generate electricity and to cool power-producing equipment, making it one of the main causes of water extraction in the U.S. This means that each kilowatt-hour (kWh) of clean solar energy generated reduces water use in addition to GHG emissions.

Comparing their past and improved processes in terms of economics/environment and social aspects

Tesla is reinventing itself into a company that is cleaner, more effective, and more responsible than ever before, starting with the people it employs and moving on to its supply chain and products. Tesla is making strides to better itself while setting a standard for the entire automotive industry.

Environmental:

Tesla customers avoided 8.4 million metric tonnes of CO2e emissions in 2021, assisting the global transition to sustainable energy. By the end of 2021, Tesla (including SolarCity) installed about 4.0 Gigawatts of solar panels and produced more than 25.0 Terawatt-hours (TWhs) of clean energy. For comparison, it has produced more energy with its installations than it needed to run all its factories since it started producing the Model S in 2012, as well as all its automobiles combined over the same time.

Social Changes (People):

Tesla’s 2021 Impact Report placed a lot of emphasis on the company’s majority-minority workforce, which includes 62% members of underrepresented groups in the US. This was made possible by Tesla’s Diversity, Equity, and Inclusion team using a people-first and data-driven strategy. Tesla also emphasized that the business continues to be appealing to job seekers. Tesla received 3 million applications in 2021 alone and was rated as the 2nd best company that engineering graduates want to work for after SpaceX.

Economics:

Tesla is a highly vertically integrated and very efficient company. Due to its unassailable lead, it’s currently the only company that can produce electric vehicles at scale profitably (selling every car they make with 6–12 months of backlogs). Over the past year, its gross automotive margin increased from 26.5%, which was already among the greatest in the car industry, to approximately 33%. It has software like margins for an auto company which is unheard of.

References:

1. Tesla 2021 Impact Report. Retrieved from tesla.com/ns_videos/2021-tesla-impact-repor..

2. AlexandraMerz @TeslaBoomerMama. (n.d.). Moody’s, the world is watching. Alexandramerz.substack.com. Retrieved November 7, 2022, from alexandramerz.substack.com/p/moodys-the-wor..

3. Dodd, L. (2022, April 14). ARK’s Expected Value For Tesla In 2026: $4,600 per Share. ARK Invest. ark-invest.com/articles/analyst-research/ar..