Guys Syrah is already under contractual obligation to supply Tesla up to 8ktpa of AAM offtake (of it's 11.25ktpa capacity) once Tesla confirms validation & commencement. Hence they only really had 3.25ktpa of spare capacity they could commit to providing to a new customer - of which Lucid will take 2.33ktpa of (i.e. 72% of total spare capacity).
So most of the existing Vidalia 11.25ktpa is now committed - and Tesla has an option for up to an additional 17ktpa of the additional 33.75ktpa (50%) of the 45ktpa upgrade option.
With very limited non-China global AAM supply, brewing trade tensions & a Chinese CCP quite happy to weaponise the US's critical trade dependencies in reply, and a live & imminent Chinese graphite/AAM dumping inquiry - It really isn't too hard to see the possibility of Tesla (& other OEM's) finally realising it's in their own longer term interests to secure scarce non-Chinese AAM supply, and stop stalling/dithering on qualification processes for their own short-term interest in continuing to hoover up cheap State-sponsored Chinese synthetic AAM.
US OEM's continuing short term thinking & political lobbying to delay government action on shoring up critical domestic suppl, could come home to roost quite dramatically, and be one of the biggest own-goals & unintended consequences of their incredibly short-term thinking.
Watching & waiting for the possible fireworks, caused by their own greed & incredible short-term greed & self-interest...
SYR Price at posting:
24.5¢ Sentiment: Hold Disclosure: Held
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