As the leading electric vehicle (EV) manufacturer in the world, Tesla needs to work with a variety of suppliers and technical partners to get its products on the road. Since EVs are battery-powered, one of the biggest resources necessary for its operations is lithium – but where does a company like Tesla get its supply at a time when EV makers are scrambling to secure their respective reserves of the precious mineral?
The short answer is that Tesla gets its lithium supply from companies in Australia and China. The long answer, however, is a little more complicated than that.
Multiple Sources for a Precious Resource
As of December 2021, Tesla formally renewed its lithium supply deal with Chinese firm Ganfeng Lithium, currently hailed as one of the world’s leading lithium producers. Beginning last year, Ganfeng now supplies Tesla with lithium and will continue to do so until the end of 2024.
But Ganfeng is far from the only company Tesla deals with in terms of its lithium supply. The electric automaker also has contracts with the likes of Livent and Albemarle, as well as with another Chinese company, the Sichuan Yahua Industrial Group. The last firm mentioned formally entered an agreement with Tesla in 2020 and now supplies it with battery-grade lithium hydroxide.
But China and the United States aren’t the only ones bringing the goods in for Tesla as the company recently inked an agreement with an Australian firm that has yet to get production going. Slated to begin supplying Tesla with lithium spodumene concentrate, Australia’s Liontown Resources expects to begin mining operations between 2024 and 2025.
Tesla also recently amended its agreement with yet another firm, Piedmont Lithium, which will be hauling in spodumene concentrate from its operations within North America – giving it a geographical advantage as it is within the same region as the carmaker. In the agreement amended back in January of this year, Piedmont will deliver around 125,000 metric tons of spodumene concentrate to Tesla from the second half of 2023 and well into 2025.
Could Tesla Choose to Mine its Own Lithium?
But given how automakers across the globe are fighting to secure their own long-term supply of lithium, Tesla may just pull up the stakes and decide to have its own lithium mine.
Back in 2020, company founder Elon Musk sent shockwaves through the EV industry when he announced that Tesla had access to a number of lithium-rich clay deposits in the state of Nevada, as well as the technology to mine the material more sustainably.
Experts, however, have opted to take the tech mogul’s words with a grain of salt, given that mining lithium is anything but easy and it is impossible to begin output within a very short span of time even with relevant technologies.