Business Tesla might get into the business of mining minerals used in electric vehicle batteries if it wants to expand its product
Tesla might get into the business of mining minerals used in electric vehicle batteries if it wants to expand its product lineup and scale production, CEO Elon Musk said during the company’s annual shareholder meeting.
The comments came after Musk talked about plans for an electric pickup truck and an aim to begin production of its all-electric Class 8 semi truck by the end of 2020. He said those plans were dependent on Tesla’s ability to manufacture a lot of lithium-ion battery cells.
“There’s not much point in adding product complexity if we don’t have enough batteries,” he said. “That is complexity, but without gain.”
Tesla’s massive factory in Sparks, Nev. was built to expand global battery capacity, and in turn reduce the cost of electric vehicles. The plant, called Gigafactory 1, produces Model 3 electric motors and battery packs, in addition to Tesla’s energy storage products, Powerwall and Powerpack. Panasonic, its most important partner as a supplier and partner in that project, makes the cells. Tesla then uses the cells to make battery packs for its electric vehicles.
For now, Tesla plans to match product rollout with scaling of factory production. Once Tesla increases production to a “very high level,” it will “look further down the supply chain and get into the mining business, I don’t know, maybe a little bit at least,” Musk exclaimed.
“We will do whatever we have to do to ensure that we can scale at the fastest rate possible,” he added.
Concern about the supply of nickel, copper, lithium and related minerals used in electric batteries is not new. Last month, Tesla’s head of minerals procurement said during a closed meeting at an industry conference that the company expects global shortages of nickel, copper and lithium in the near future, Reuters reported.
While much of the attention has focused on lithium supplies, copper and nickel are also vulnerable. Years of underinvestment have depleted copper supplies, prompting companies like Freeport-McMoRan to expand in the United States and Indonesia.
It’s possible that Tesla will focus on nickel mining, a mineral that Musk has pushed the company to use more of in lieu of cobalt.