Where does Tesla get its Lithium? What is this Tesla about?

Where does Tesla get its Lithium? Lithium in particular has caught the attention of CEO Elon Musk. Back in 2020, the battery metal had a spotlight moment at Tesla’s Battery Day, when Musk shared that the company had bought tenements in the US state of Nevada, and was looking for a new way to produce lithium from clay — a process yet to be proven at commercial scale.

Since then, lithium prices have hit all-time highs and, despite retreating in 2023, have stayed elevated. Prices for other key battery metals have also increased, leading to higher costs for batteries themselves. According to Benchmark Mineral Intelligence, raw materials currently make up about 80 percent of battery costs, up from around 40 percent back in 2015.

Where does Tesla get its Lithium?

Tesla obtains its lithium from a number of sources, such as:

  • With numerous Australian lithium producers, including Core Lithium and Liontown Resources, Tesla has long-term supply agreements.
  • China: Since China is the world’s top producer of lithium, Tesla also purchases lithium from there. Ganfeng Lithium is the primary source of lithium for Tesla in China.
  • United States: Tesla has started obtaining lithium from this country as well. 2020 saw Tesla purchase the rights to Nevada’s lithium-rich clay resources. The business is now creating a brand-new method for removing lithium from these resources.

Additionally, Tesla is attempting to establish its own lithium refining facilities. Tesla made plans to erect a lithium refinery in Texas in 2022. In 2024, this refinery is anticipated to begin operations.

It is significant that Tesla has diversified its lithium supply chain because lithium is a crucial component of batteries for electric vehicles. Tesla can lower the risk of disruption and make sure it has a consistent supply of lithium for its vehicles by obtaining lithium from a range of different sources.

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Along with the aforementioned, Tesla is also investing in cutting-edge methods for obtaining lithium from unorthodox sources like geothermal brine and saltwater. This would lessen Tesla’s reliance on conventional mining operations and broaden the supply chain for lithium.

 Tesla get its Lithium

Who is the biggest supplier of lithium to Tesla?

Ganfeng Lithium, a Chinese business that is the second-largest producer of lithium in the world, is Tesla’s main source of lithium. A long-term supply arrangement between Tesla and Ganfeng Lithium was extended in 2021.

Other significant lithium suppliers to Tesla include:

  • The United States’ Albemarle
  • (Chile) SQM
  • The United States’ Livent
  • Australia’s Core Lithium
  • Australian resource company Liontown

In an effort to diversify its lithium supply chain, Tesla has started sourcing the metal from new vendors like Piedmont Lithium in the United States and Lithium Americas in Canada.

Given the possibility of trade conflicts between the United States and China, some analysts have expressed concern over Tesla’s reliance on Chinese lithium sources. By diversifying its supply chain and investing in new methods to collect lithium from non-traditional sources, Tesla has taken measures to mitigate risk.

Where does Elon Musk buy his lithium?

Elon Musk purchases lithium for Tesla from a number of suppliers, such as:

  • Australia
  • China
  • The United States

With numerous lithium producers in Australia, including Core Lithium and Liontown Resources, Tesla has long-term supply agreements. China, the greatest producer of lithium in the world, is another supply of lithium for the corporation. Ganfeng Lithium is the primary source of lithium for Tesla in China.

2020 saw Tesla purchase the rights to Nevada’s lithium-rich clay resources. The business is now creating a brand-new method for removing lithium from these resources. Additionally, Tesla is attempting to establish its own lithium refining facilities. Tesla made plans to erect a lithium refinery in Texas in 2022. In 2024, this refinery is anticipated to begin operations.

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It is significant that Tesla has diversified its lithium supply chain because lithium is a crucial component of batteries for electric vehicles. Tesla can lower the risk of disruption and make sure it has a consistent supply of lithium for its vehicles by obtaining lithium from a range of different sources.

It’s vital to understand that Elon Musk is not purchasing lithium for Tesla personally. A group of procurement experts at Tesla is in charge of finding lithium and other resources for the business.

Tesla get its Lithium

Does Tesla use child labor for cobalt?

Tesla has claimed that it does not use child labor for cobalt, but because to the convoluted and secretive structure of the cobalt supply chain, it has been challenging for the business to substantiate this claim.

More than 60% of the cobalt produced worldwide is produced in the Democratic Republic of the Congo (DRC), where a large portion is mined by hand, frequently by young children. For a variety of factors, including poverty, limited access to school, and pressure from their families, children work in cobalt mines.

To address the issue of child labor in its cobalt supply chain, Tesla has taken some action. For instance, the business has collaborated with its suppliers to create rules for the prevention of child labor and to put in place mechanisms for monitoring. However, due to the supply chain’s complexity and the difficulties of conducting business in the DRC, Tesla has found it challenging to verify that no child labor is utilized in the production of its cobalt.

A group of Tesla shareholders sued the business in 2023, claiming that Tesla had not done enough to address the problem of child labor in its cobalt supply chain. The legal action is still pending.

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Overall, it is challenging to say with certainty whether Tesla employs children to produce cobalt. The corporation has taken some action to solve the problem, but it has been challenging for the company to confirm that there is no child labor in their cobalt supply chain.

Will Tesla make its own lithium?

Indeed, Tesla intends to produce its own lithium. Tesla made plans to erect a lithium refinery in Texas in 2022. In 2024, this refinery is anticipated to begin operations.

Tesla is also striving to create fresh methods for obtaining lithium from unorthodox sources like seawater and geothermal brine. This would lessen Tesla’s reliance on conventional mining operations and broaden the supply chain for lithium.

Several considerations, including the following, led Tesla to decide to produce its own lithium, including:

  • To cut expenses, Tesla thinks it can produce lithium for less money than it would pay to get it from vendors.
  • Supply assurance: Tesla needs to make sure that it has a steady supply of lithium for its electric cars.
  • Tesla is funding the development of new technologies to harvest lithium from unorthodox sources. This may lessen the negative effects of lithium mining on the environment and increase the sustainability of the lithium supply chain.

An important milestone for the electric vehicle sector is Tesla’s decision to produce its own lithium. It demonstrates how dedicated Tesla is to protecting its supply of essential materials and to creating innovative technologies that will lessen the environmental effect of electric automobiles.

It’s vital to remember that Tesla is still growing its capacity for refining lithium. It is too soon to predict how well the company will be able to produce its own lithium or how much of its lithium requirements the company will be able to satisfy. Tesla has taken a huge step in securing its supply of this essential material, though, with its investment in lithium refinery.

 Tesla get its Lithium

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