Tesla Gigafactory Could Be Boon For Graphite, Lithium, Cobalt
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Tesla Motors Inc (NASDAQ:TSLA) makes the most sought-after electric cars in the world. The cars run on advanced electric batteries and Tesla CEO Elon Musk wants to build those batteries in America. Tesla has dubbed its $5-billion pet project the "Gigafactory," and it could be up and running by 2017, prompting the need for battery-grade materials like graphite, lithium and cobalt.
About 55% of the world's [cobalt] output comes from the Democratic Republic of the Congo as a byproduct of copper mining.
Tesla, by the way, says that it doesn't source from the Congo.
The next biggest producers are found in China, Russia and Australia, but they only produce 5–7 Kt annually. Tesla would need about 7 Kt for its plant at capacity. I think that's a big supply risk.
The startup is expected in 2017, and then it would reach capacity in 2020. It's just a case of scale and trying to secure the raw materials. Three years seems reasonable.
