Tesla's Energy Storage Business Faces Unexpected Headwinds Despite Market Growth
Even Tesla's energy storage, usually a reliable area, isn't immune to the company's challenges. I've noticed that their Powerwall and Megapack deployments have dipped for the second quarter in a row. According to their numbers, they installed 9.6 gigawatt-hours in the second quarter, which is less than the first.
Remember that stellar performance in the fourth quarter of 2024? They deployed 11 gigawatt-hours then. They managed 31.4 GWh total for the whole year. Until recently, their energy sector was consistently growing, with revenue jumping from $2 billion in 2020 to over $10 billion last year. But this year's slow start suggests that winning streak might be over.
Interestingly, while Tesla stumbles, the energy storage market is actually booming. Wood Mackenzie's analysts reported record-high installations in the first quarter, growing by 57% year-over-year. It's like everyone else is having a party, and Tesla missed the invitation.
However, this growth might not last. Tariffs on Chinese goods and potential changes to the Inflation Reduction Act could throw a wrench into things. Republicans are trying to roll back key parts of the act, which could make it harder to claim tax credits for battery storage due to restrictions on foreign-sourced materials. Given that most battery minerals are processed in China, this could be a big problem.
Source: TechCrunch