Tesla showcases an LFP plant in Nevada near Gigafactory Nevada

Tesla has published a video in which it for the first time shows in detail a new facility for producing lithium iron phosphate (LFP) batteries next to Gigafactory Nevada. The footage offers a rare look at how far along the site is and what technology choices the company has made for local production in the U.S.

The emergence of such a factory fits into the broader picture of the accelerating localization of LFP within the U.S. supply chain. For the market, it is a notable signal that a chemistry that has long dominated China’s EV and energy-storage segments is now taking hold in the U.S. as well—not only via imported cells, but also through the transfer of manufacturing practices.

The U.S. LFP wave—and Tesla’s low-key approach

Over the past week, Ford and LG Energy Solution announced their LFP projects in the U.S., and against that backdrop Tesla also revealed details of its own direction. At the same time, the company did without a standalone on-stage announcement and instead emphasized a look at the production infrastructure via a company video.

That format leaves gaps in the information. Specific equipment models and the timeline for ramping to nameplate capacity are not named, and it is also not specified which components will be localized domestically first. At the same time, visual cues from the production line allow industry observers to discuss not only the fact of the project itself, but also the choice of process, which often says more about manufacturing maturity than a press release.

Such an initiative benefits Nevada’s economy

Nevada was previously known mainly thanks to Las Vegas, which is known as the gambling capital of the world. However, in recent years that status could become a liability, as more people gamble and place bets online in large numbers.

Moreover, this is happening not only in the U.S., but all over the world—from Europe to Asia. Especially in India, which is one of the fastest-growing iGaming markets in the world. According to data from an industry website, the popularity of cricket betting in Telangana is growing. But the growth of online gambling is happening much more actively. And this leads to the fact that people not only in India, but also around the world are starting to visit land-based casinos and bookmakers’ shops less often.

In such a situation, Las Vegas and Nevada urgently need to diversify their economy so as not to depend only on gambling and the entertainment industry. Therefore, the development of industry in the state is coming at just the right time.

Why LFP went mainstream in China and is now heading West

Over the years, LFP has turned into a foundational chemistry in China thanks to a combination of scale and a well-developed industrial ecosystem. Supply chains, standardized lines, and accumulated experience have formed there, reducing risk when scaling to high volumes. In the energy-storage segment, LFP has become established as a workhorse chemistry designed for daily cycling.

In the U.S. and Europe, interest in LFP is growing for pragmatic reasons. Manufacturers are seeking to expand their lineups without a sharp increase in unit costs while also reducing dependence on materials that are harder and more expensive to procure. By that reasoning, LFP looks not like an exotic option, but like a tool for part of the model range and for stationary storage, where longevity and resilience to repeated charging matter.

LFP and NMC on the same trade-off spectrum

Historically, NMC cells—that is, nickel manganese cobalt—have been used more often in Western markets, especially in cars where specific energy is critical. LFP competes with them not through record-breaking performance, but through predictability and economics.

The key differences are usually described as follows:

• LFP is generally cheaper in terms of materials and production supply chains
• LFP is typically safer thermally—that is, more resistant to overheating and thermal runaway
• LFP more often wins on service life and cycle life, which is important for storage and intensive use
• NMC typically provides higher energy density, which helps increase range at a comparable battery mass

These points depend on the specific cell architecture and manufacturing quality, so direct comparisons on a single parameter can often be misleading. In practice, manufacturers choose the chemistry to match the use case—much like choosing an engine for a given route.

How CATL plugs in differs, and it shapes policy and technology

Of particular interest is how China’s CATL is present in U.S. projects. For its plant in Michigan, Ford took the route of a technology licensing agreement, which immediately brought the project under intense political scrutiny. Tesla, according to reports, chose a different approach and purchased manufacturing equipment from CATL.

The implications of such a choice for Tesla are often framed as a single package of implications. The company gains more control over the process at its own site, retains access to a mature Chinese manufacturing base, and reduces the scope for political controversy around the partnership format. At the same time, dependence on equipment supplies and know-how does not disappear completely; it simply takes a less public form.

From equipment to process: wet coating on the Nevada line

If the manufacturing base relies on CATL’s industrial practices, the choice of an initial technology route also looks logical. Footage from the video indicates that wet coating is used at the site in electrode manufacturing. This is a method in which active materials are mixed with a solvent, applied to the current collector, and then dried.

For LFP, this is a common and well-proven technology aligned with the industry’s dominant approaches. The choice reads as pragmatic: a bet on a predictable launch and repeatable quality, where consistent output matters more than demonstrating experimental superiority.

Dry coating for 4680 and first deliveries for energy storage

At the other pole of technological ambition remains dry coating, which Tesla is developing for 4680-format cells in Texas. This route is seen as potentially more efficient in terms of materials and energy use, but it is harder to refine, so it looks more like an engineering frontier than a ready standard for rapidly scaling LFP.

The Nevada facility is expected to start at around 10 GWh of annual capacity. The first volumes, by available estimates, will most likely be directed not to cars, but to stationary energy storage systems, including Powerwall and Megapack, where longevity and cycle life often matter more than maximum energy density.

LG Energy Solution shows similar logic in its project in Michigan, where the emphasis for LFP is also linked to grid energy storage tasks. This choice of application reflects current demand for storage for power systems and commercial facilities, as well as LFP’s strengths in frequent charge/discharge without accelerated degradation.