The potential battery-grade lithium hydroxide refinery, which Tesla touts as the first of its kind in North America, will process “raw ore material into a usable state. the battery production,” the company said in an application filed with the Texas Comptroller’s Office.
Tesla said the decision to invest in Texas will also be based on the possibility of local property tax relief.
Musk has also been vocal about the need for more players in the lithium refining industry. “You can’t lose. It’s licensed to print money,” he said during the company’s second-quarter earnings press conference.
Ensuring a steady supply of battery components is considered crucial for Tesla as it faces fierce competition in a rapidly growing market for Electric Car.
If approved, construction could begin in the fourth quarter of 2022 and commercial production by the end of 2024, Tesla said in its August 22 application.
According to the plan, Tesla will ship the final product from the refinery with truck and rail to various Tesla battery production sites, supporting the large-scale and electric vehicle battery supply chain.
Tesla, whose stock rose 1.4% in pre-market trading, also said it would use less hazardous reagents and produce usable by-products than the conventional process.
Lithium prices have skyrocketed this year due to increased demand from the automotive sector. China remains the world’s largest lithium processor, although rival projects proposed in the United States and the European Union have faced a series of obstacles.
If Tesla’s plan goes through, the automaker could become the first in the field to invest directly in lithium refining as automakers jostle for deals with Tesla. operators and refineries.
“Automakers are trying to make sure they have control of lithium supplies, just in case of any geopolitical situation,” said Arpit Agarwal, director at venture capital firm Blume Ventures. which may arise in the future when supply is disrupted” as Euler Motors and Yulu.
Tesla will also profit from lower logistics costs as well as incentives that the US government may receive, he added.
Battery makers are also looking to increase production in the United States, where the shift to electric vehicles could accelerate as the country implements tighter regulations and tightens tax credit eligibility.
CATLThe world’s largest battery maker, has also bought stakes in lithium mining companies.
(Reporting by Jaiveer Singh Shekhawat, Maria Ponnezhath and Yuvraj Malik in Bengaluru; Editing by Saumyadeb Chakrabarty and Anil D’Silva)