Elon Musk suggests Tesla could start mining lithium

The CEO of Tesla assures that “there is no shortage of lithium “, despite the fact that there is a crisis of the mineral today.

Advertisements

Elon Musk has suggested that Tesla , the company where he is CEO, could start mining lithium , a vital mineral for the electric car industry he leads.

This idea was raised through Twitter, highlighting the high prices at which this input is found.

“The price of lithium has reached crazy levels!” said the millionaire. “Tesla may have to go into mining and refining directly at scale, unless costs improve.”

Elon Musk continued his thread by pointing out that “there is no shortage of the element itself”, but rather that the crisis is due to “the slow rate of extraction/refinement”.

An index of global lithium prices compiled by Benchmark Mineral Intelligence is up nearly 490% in the past year.

Lithium is a key component in electric vehicle batteries , so automakers are racing to secure supplies, hoping for a surge in demand amid a global push for transport electrification. Tesla has signed supply deals with battery metal producers in recent years, including a secret one with mining giant Vale.

A blow to the electric car industry

Tesla is likely to have to rely on lithium for the foreseeable future, despite rising costs. That means we may see Tesla and other electric vehicle manufacturers raising their prices, undermining ongoing efforts to advocate for widespread adoption of these types of cars.

In fact, Tesla already had to raise prices across its entire lineup last month, with the cheapest Model 3 now costing more than $46,000.

It is a difficult period for electric vehicle manufacturers. Inflation problems are compounded by the continuing global shortage of microchips and political uncertainty resulting from the Russian invasion of Ukraine, driving up commodity prices.