Pioneer electrical automobile (EV) maker Tesla (NASDAQ:TSLA) is trying to arrange a lithium-refining facility within the US later this 12 months, with manufacturing to be shipped to the corporate’s battery manufacturing websites.
Tesla is looking for aid on native property taxes for the refinery, which it says can be “the primary of its type in North America,” as per an utility with the Texas Comptroller’s Workplace.
The carmaker is contemplating potential websites in Texas and Louisiana. Topic to approval, development may begin as early as the top of 2022, with first output anticipated by the top of 2024.
In response to Tesla, the method it’ll use on the facility is “revolutionary and designed to devour much less hazardous reagents and create usable by-products in comparison with the traditional course of.”
The Elon Musk-led firm additionally mentioned it’s evaluating constructing out amenities to assist different sorts of battery supplies processing, refining and manufacturing.
“The transfer alerts an additional pattern in direction of vertical integration for EV makers — vitally essential given the excessive value of battery uncooked supplies and more and more restricted choices to safe materials,” Mission Blue analysts mentioned.
CEO Musk has been calling for extra lithium growth since earlier this 12 months. Following a rally for the commodity seen in 2021, he identified that costs have been at “insane” ranges.
“I’d wish to as soon as once more urge entrepreneurs to enter the lithium-refining enterprise. The mining is comparatively simple, the refining is far tougher,” Musk mentioned on a July earnings name, including that there are software-like margins to be made in lithium processing. “You’ll be able to’t lose, it’s a license to print cash.”
Most lithium mining occurs in Australia from hard-rock sources and in Chile from brines, and people international locations are the 2 high producers. However lithium refining is dominated by China, which presently accounts for greater than 75 % of worldwide lithium processing capability — with the US falling far behind.
It isn’t the primary time Tesla has thought-about leaping additional upstream. In 2020, at Tesla’s battery day, the Austin-based firm introduced plans to construct a cathode plant in Texas and a lithium hydroxide chemical facility, the place it’ll flip hard-rock spodumene focus into lithium hydroxide for direct use in its battery cells.
Tesla’s present lithium suppliers embody high producer Ganfeng (OTC Pink:GNENF,SZSE:002460), and earlier this 12 months the corporate additionally signed offers with juniors Liontown Sources (ASX:LTR) and Core Lithium (ASX:CXO,OTC Pink:CXOXF) for future provide.
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Securities Disclosure: I, Priscila Barrera, maintain no direct funding curiosity in any firm talked about on this article.
