Tesla Increases Purchase of Raw Materials for Batteries in Australia as Production of 4680 Cells Nears

Photo: Tesla

Tesla Chairman Robyn Denholm said the company intends to significantly increase the amount of raw materials it purchases from Australia for the production of batteries. In the near future, the company will start spending over $1 billion a year to buy nickel and lithium mined in the country.

Robyn Denholm said on June 2 that Australia, which is rich in minerals used to make batteries, will soon benefit even more from the development of supply chains with the development of electric vehicles. Tesla plans to significantly increase the amount of purchased raw materials it will use to make batteries, reported Reuters.

"We expect our spend on Australian minerals to increase to more than $1 billion per annum for the next few years," Denholm told a Minerals Council of Australia event.

At the moment, Tesla already buys three quarters of its lithium raw materials and more than a third of its nickel from Australia, since the country produces it in compliance with all established standards. "Australian mining companies do have a good reputation, great expertise, professionalism and are preferred by manufacturers increasingly concerned about meeting both today’s and the future’s ESG requirements," she said.

Tesla CEO Elon Musk also confirmed that the company buys most of the lithium for its needs in Australia. He also said that while phone batteries make heavy use of cobalt in the cathode, the manufacturer uses primarily nickel.

That’s where we get most of our lithium. Also, whereas phone batteries make heavy use of cobalt in cathode, Tesla uses primarily nickel, which is trickier, but has better energy density (range).

Iron cathode cells are now competitive for stationary packs & mid range cars.

— Elon Musk (@elonmusk) June 2, 2021

The increase in purchases occurs against the backdrop of the rapid growth of Tesla's production capabilities, as well as on the eve of the start of production of 4680 battery cells. For now, the test line in Fremont is preparing for mass production, although the last update was during the Q1 2021 Earnings Call in April, and the company could have already made more progress since then. The construction of battery factories at Giga Berlin and Giga Texas has also begun, which means that already by next year, the company will be able to expand the production of new battery cells, which will require a significant amount of raw materials.

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