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Tesla's Batteries Will Contain A Lot Of Nickel In Foreseeable Future

Elon Musk: "Please mine more nickel."

Tesla CEO Elon Musk recently "urged miners to produce more nickel" as the company is happily willing to secure long-term nickel suppliers for battery production.

Nickel is one of the key ingredients of the cathode of lithium-ion cells, especially in higher-energy dense chemistries with low cobalt content (like the Tesla-Panasonic NCA or LG Chem NCM 811).

"Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way,” Musk said on a post-earnings call on Wednesday."

The hint about growing nickel demand and a long-term supply contract, together with the previous cobalt supply agreement, indicates that Tesla intends to use nickel and cobalt-based batteries in the foreseeable future.

Maybe the company will reveal more details about its tech at the upcoming, long-awaited Battery Day, but as of today, there is no sign about a battery chemistry that would turn everything upside down - like a totally new chemistry/other elements.

Tesla would then not bother to use nickel and cobalt.

At least, that's our guess.

The key thing for Tesla seems to be the focus on lowering the prices of batteries.

The energy density is probably already high enough to be satisfied with slower evolution there.

“The real limitation on Tesla growth is cell production at affordable price.

That’s the real limit,” Musk said, adding the company would expand its business with Panasonic and CATL and “possibly with others”."

If that is true, the next big thing for Tesla should be a significant improvement to the production process of batteries.

We would not be surprised if Battery Day reveals a production improvement instead of groundbreaking chemistry.

https://insideevs.com/news/435490/tesla-batteries-nickel-foreseeable-future/




'Please mine more nickel,' Musk urges as Tesla boosts production

Tesla Inc boss Elon Musk urged miners to produce more nickel, a key ingredient in the batteries that power the company’s electric cars, warning the current cost of batteries remained a big hurdle to the company’s growth.

“Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way,” Musk said on a post-earnings call on Wednesday.

Nickel makes batteries energy dense so cars can run further on a single charge, and Tesla needs the metal more than ever as it looks to ramp up production of trucks and solar projects that use a lot of nickel.

Musk’s call for greater nickel mining comes even as prices for battery materials wallow around rock bottom.

However, traders and analysts say the kinds of volumes Tesla would need are unlikely to make a compelling business case for most miners to invest in increased production, nor are they likely to boost prices.

Tesla currently sources nickel-cobalt-manganese (NCM) batteries from South Korea’s LG Chem Ltd and nickel-cobalt-aluminium (NCA) batteries from Japan’s Panasonic Corp.

These companies indirectly buy nickel from mining companies in a long auto supply chain.

Tesla doesn’t disclose which nickel miners are in its supply chain.

Given Tesla’s focus on sustainability, the company is likely to prefer to buy from miners of higher-grade nickel sulphide, which requires less power to process than laterite ore, said Lachlan Shaw of National Australia Bank.

There are three key suppliers - Brazil’s Vale, which operates in Canada using some hydropower, Russia’s Norilsk Nickel and BHP Group’s operations in Western Australia.

“Vale is in the box seat,” he said.

While electric vehicles consume a much smaller amount of nickel than traditional industries such as stainless steel makers, EVs are expected to be the quickest growth market for nickel miners.

Nickel consumption in EV battery materials is expected to soar 64% between 2019 and 2025, research firm Wood Mackensie said, although it added that satisfying this demand could be challenging for an industry that has been slow to add capacity in a timely and cost-effective manner.

“He needs nickel, so he hopes nickel prices will go lower and lower,” said a China-based nickel trader.

“Prices will not be impacted in the short-term because the market is in surplus.”

Nickel hit a 14-month low of $10,865 a tonne in March but has since recovered to $13,180, still down by some 30% from five-year peaks seen in September.

Tesla on Wednesday posted a second-quarter profit, but Musk said he would prioritise growth over profit going forward, and focus on making Tesla vehicles more affordable.

“The real limitation on Tesla growth is cell production at affordable price.

That’s the real limit,” Musk said, adding the company would expand its business with Panasonic and CATL.

Tesla is expected to reveal technological advances at its “Battery Day” event in September.



www.reuters.com


What The Tesla-Glencore Cobalt Deal Might Really Mean

Securing cobalt supplies might mean that there is no cobalt-free battery chemistry just yet (aside from low-energy-dense LFP, or specific types).

Earlier this week we saw unofficial reports about a cobalt supply agreement between Tesla and Glencore, which might be as much as 6,000 tons per year.

If true, it would be one of the biggest deals in the industry. According to Adamas Intelligence, in 2019 the global demand for cobalt for batteries for passenger xEVs (BEV, PHEV, HEV) exceeded 14,400 tonnes.

For comparison, Glencore recently signed two deals with battery manufacturers:

• with SK Innovation: up to 30,000 tons of cobalt for lithium-ion batteries over six years (2020-2025) or up to 5,000 tons per year.
• with Samsung SDI: up to 21,000 tons of cobalt for lithium-ion batteries over five years (2020-2024) or up to over 4,000 tons per year.

As we can see, at 6,000 tons per year, Tesla would be a major player in the industry.

According to the reports, Tesla secured the cobalt supply for its plant in China and upcoming plant in Germany.

As we understand, Tesla will make the cobalt available for its battery partners like Panasonic, LG Chem or others.

Other manufacturers also sometimes use their leverage to secure important elements for its suppliers.

Glencore mines cobalt in the Democratic Republic of Congo, so the manufacturers will put pressure on the company to do it in the most environmentally friendly and ethical way.

Assuming that the report is right, it seems that Tesla will remain heavily engaged in batteries, in current lithium-ion batteries to be precise, which still use cobalt (5-10% of cathodes we guess).

If there would be a chance to get rid of cobalt completely in the next few years, such a deal probably would not be necessary.

The other interesting thing is - for whom in Europe Tesla purchased the cobalt?

It might be LG Chem too, it might be someone else.

https://insideevs.com/news/429771/tesla-glencore-cobalt-deal/



Tesla Production Sites By Model Assignment, Capacity: July 2020

Tesla: "Later this year, we will be building three factories on three continents simultaneously."

The second quarter of 2020 is already behind us so let's check out the manufacturing infrastructure of the world's largest electric car maker Tesla.

The company is expanding its plants, as well as building new, which should increase the output up to around 800,000 annually this year.

Total production and sales in 2020 should exceed 500,000, despite the COVID-19 lockdown in Q1/Q2.

https://insideevs.com/news/435448/tesla-production-sites-assignment-capacity-july-2020/


Tesla electrifies the auto industry’s new era

Elon Musk’s young carmaker leads global transformation of transportation

Tesla’s rapid ascent to the most valuable automaker in the world marks the beginning of a new era for the industry, one in which expertise in digital technology and electrification will be the critical factor for success, not the manufacturing efficiency that made Toyota the industry’s leading company for the past 25 years.

Among the leading automakers, Tesla’s new pre-eminence parallels Microsoft passing IBM in the 1980s — or General Motors eclipsing Ford nearly a century ago.

The difference today is that investors look at Tesla as a software- and data-driven company while traditional automakers such as GM and Toyota are seen as more focused on hardware and machinery.

Auto industry’s turning point

In April 2017, Tesla overtook General Motors to claim the largest market capitalization among U.S. automakers, marking the first time in the era of the modern automobile that that mantle was not held by one of Detroit’s “Big Three.”

In late June 2020, Tesla zoomed past Toyota to become the most valuable carmaker on the planet, its value now eight times that of General Motors…

Toyota passed General Motors in value 24 years ago, in June 1996.

The Japanese automaker remained the world’s most valuable until June 29, 2020, before the phenomenal pace of Tesla share price rise shot the market cap of the California electric car maker to the top.

Tesla’s revenue has grown steadily since the company had its initial public offering in June 2010.

So, too, has its share price, although the stock has often been more volatile than those of traditional automakers such as GM and Toyota.

The rapid run-up in Tesla’s share price and concurrent rise in valuation don’t reflect the disparity between its revenue — $24.6 billion in 2019 — and that of Toyota ($280 billion) and GM ($137 billion).

Tesla also produces a fraction of the vehicles built each year by the two auto giants.

https://graphics.reuters.com/AUTOS-TESLA/NEWERA/bdwvkerrkvm/index.html









Food for thought

Cheers

Frank