Tesla Motors wants mining companies that have never produced highly combustible lithium to provide the electric vehicle maker the material necessary to make its lithium ion battery.
A report from Financial Post states that Tesla and two companies, Pure Energy Minerals Limited and Bacanora Minerals, are currently in talks to mine more lithium material for CEO Elon Musk’s fleet of electric vehicles (EV).
There’s only one problem: Neither of these companies has ever produced lithium-derived elements or even conducted feasibility studies on the mining of the highly combustible, environmentally dangerous material, according to Autoblog.
The report goes on to note that the demand for lithium is likely to pitch upward, as the highly combustible material is used to make a host of modern day electronics, such as smart phones and EVs.
“If you look at the rate of the new models — the number of subscriptions for those new models was around 270,000 subscriptions,” Luke Kissam, CEO of lithium producer Albemarle, said in an interview in early April. “That would roughly require somewhere between 15 and 20,000 metric tonnes of lithium carbonate equivalent to supply that demand. So that is a huge step for demand going forward.”
The move to search for new sources of lithium comes as Tesla breaks ground on its new “gigafactory” factory in Nevada, which is designed to make it easier to mainstream EVs by ratcheting down the already hefty costs of lithium ion batteries through mass production.
The EV company has agreed to buy up minimum tonnages of lithium from Pure Energy and Bacanora Minerals, conditional on whether they are able to meet grade, tonnage, and most importantly, Tesla’s price range.
Industry insiders believe Tesla is playing cat and mouse with Albemarle Corporation, as well as Sociedad Quimica y Minera de Chile (ADR), and FMC Corp., all of which combined sell 90 percent of the world’s lithium.
Accepting bids from the two companies with no experience in lithium production, they say, may simply be a ploy to force other producers into coming down in price — the wager? Drop your lithium material prices or Tesla will use non-lithium producing companies for its batteries.
It’s a dangerous game considering the fact that the big three lithium providers understand the danger and the environmental costs associated with mining the material.
Everything about the Tesla — from its headlights, to its chassis, to the way it is produced — creates massive damage to the environment mostly because of the mining of lithium, as well as other volatile materials in the vehicle, according to a Market Wired report.
Tesla, as insiders explain, has to rely on lightweight structures to maintain its sustainable credibility. And one of the best ways to accomplish this feat, the company has wagered, is through the use of a massive lithium ion battery.
Musk’s EV company gets a lion’s share of the material composing its lithium ion battery from mines in China, where workers use massive Earth-moving equipment to carve up the ground, and later shovel ammonium sulfate in the holes.
Only 2 percent of the material pulled out of these mines is used on Tesla’s parts, according to research conducted by a leading tech investment firm. The other 98 percent of the now-badly contaminated muck, mud, and refuse is then shoveled back into the ground, causing more environmental damage.
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