Tesla's Gigafactory has started making batteries for the Model 3

Panasonic has started making lithium-ion battery cells inside the giant US building

Tesla's giant battery factory in Nevada, US, has rumbled into life and started producing the battery cells that will be built into the firm's future electric cars.

The lithium-ion cells, which Tesla is creating with Panasonic, are part of the Gigafactory that will produce 35 GWh per year of cells by 2018. This, it is claimed, is almost as much as the rest of the world's current battery production combined.

When complete the battery cells will be incorporated into Tesla's Powerwall 2 and Powerpack 2, which serve as energy storage products that can be built into homes. In the middle of 2017 the factory will also begin to produce battery cells that are used in Tesla's Model 3 electric car.

At Panasonic's CES 2017 press conference the firm's North America CEO Joseph Taylor said production at the factory had stared and would play an important roll in how electric cars are produced in the future.

The Gigafactory has been being built by Elon Musk's firm since 2014 and is part of his master plan. The plan, which was detailed by Musk in July 2016, will see Tesla produce more electric vehicles of different sizes and continue to roll-out more self-driving features.

In 2018, Tesla aims to produce 500,000 of its electric cars and being able to produce enough batteries to do so is crucial to its success. If it can produce more batteries at a decreased cost, Tesla says it can also reduce the price of its vehicles and home storage products. The building of its factory is not yet complete – it is only 30 per cent operational – but Tesla and Panasonic have started to make batteries so that production can be ramped up.

"Our phased approach also allows us to learn and continuously improve our construction and operational techniques as we continue to drive down the cost of energy storage," Tesla said in a statement.

"Already, the current structure has a footprint of 1.9 million square feet, which houses 4.9 million square feet of operational space across several floors." Tesla continued: "Once complete, we expect the Gigafactory to be the biggest building in the world."

The Gigafactory is not the only collaboration between Telsa and electronics firm Panasonic. In October, the two companies announced they would work on a New York production facility to make photovoltaic cells for solar panels.

This article was originally published by WIRED UK