Tesla's Potential North American Battery Metals Supply Chain Contenders
Since Tesla (TSLA) Battery Day, there has been a surge in interest in who can supply Tesla with the battery metals needed for them to ramp to a massive 3TWh battery capacity by 2030. To get an idea of the scale, for lithium this would mean about 2.7 million tonnes of LCE would be needed per annum, just by Tesla. This is about 9x total global lithium production in 2019.
In summary, this means for Tesla to grow to 3TWh (~20m EVs
pa + energy storage), Tesla will need massive amounts of all the battery
materials. According to Musk, they will also need to rely on several battery
manufacturers as back up, such as existing suppliers Panasonic [TYO:6752]
(OTCPK:PCRFY), Contemporary Amperex Technology Co. Ltd. (CATL) [SHE:300750],
and LG Chem [KS:051910] (OTCPK:LGCLF).
In this article, I intend to focus on potential new Tesla EV
metal suppliers from North America (USA & Canada) as Musk said at Battery
Day he would prefer to source from North America, at least for his US
operations. He also said he just needs the metal for their planned cathode
facility, not the battery grade sulphate. For now this means a focus on
lithium, cobalt, nickel, and manganese, and high purity alumina to make high
energy density nickel cathodes. I will also cover anodes and graphite, as Tesla
may also look to secure that, or at least an anode supply.
Tesla's existing supply chain
As I stated in my article from late last year:
"Choosing EV Metal Miners And Battery Manufacturers By Connecting The
Supply Chain - December 2019:
Tesla Inc. - Battery supply deals with Panasonic (and
themselves (Tesla)). Last month Tesla signed a supply deal with CATL, and they
also recently signed a deal with LG Chem to supply Model 3 in China. Tesla has
signed lithium offtake agreements with Bacanora Lithium [LSE-AIM:BCN] [GR:2F9]
(OTCPK:BCLMF), Pure Energy Minerals [TSXV:PE], Kidman Resources (bought by
Wesfarmers [ASX:WES] ---> Mt Holland JV with SQM), and more recently Ganfeng
Lithium [SHE:002460] [HK: 1772]. Cobalt supply comes via Panasonic/Sumitomo
Metal Mining Co. (TYO:5713) (OTCPK:SMMYY) and hence from sources in the
Philippines and previously Cuba (Sherritt)... Cathode supply from
Tesla/Panasonic and Umicore (OTCPK:UMICF).
Note: Tesla also sources lithium from Albemarle (ALB), who
source spodumene from their Greenbushes mine in Western Australia. They also
source nickel from Norilsk Nickel (LSX: MNOD) (OTCPK:NILSY). Since the article
above was published, Tesla has signed a cobalt deal with Glencore [HK:805]
[LSE:GLEN] (OTCPK:GLCNF) and a lithium spodumene deal with Piedmont Lithium
[ASX:PLL] (PLL). See the latest Tesla news immediately below.
Note: Tesla gets its anodes via Panasonic which source their
anode supply from Shenzhen BTR New Energy Materials Co. Ltd. ('BTR') in China.
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