Tesla CEO Elon Musk has confirmed that the company is officially entering the mining business.

Making the announcement at Tesla’s Battery Day, Mr Musk said the rights to a 10,000-acre lithium clay deposit in Nevada had been secured.

The possibility had been flagged at last year’s shareholder’s meeting, when it was teased that Tesla “might get into the business of mining minerals used in electric vehicle batteries”.

The lithium mine not only lets Tesla build a cheaper, more efficient battery that will ultimately allow it to lower the price of its vehicles, but also will bring its supply chain closer to its home.

Mr Musk and Drew Baglino, the SVP of powertrain and energy engineering at Tesla, laid out the company’s plans and progress to eventually have 10-20TW hours of annual battery production.

At the heart of that plan is a new tabless battery cell that the company introduced at the event. A new manufacturing system is still under development and Tesla plans to build infrastructure to support it.

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The lithium mine as well as a cathode facility, both of which will be in North America, will be two new additions to Tesla’s growing portfolio of factories and operations.

“We’re going to go and start building our own cathode facility in North America and leveraging all of the North American resources that exist for nickel and lithium, and just by localising our cathode supply chain and production, we can reduce miles traveled by all the materials that end up in the cathode by 80%,” Mr Baglino said.

Next to the cathode plant will be a lithium conversion facility, with the company working on a new sulphate-free process that he claimed will reduce lithium costs by 33%.

Mr Musk also said the company had a new process that can extract the lithium from ore using sodium chloride, or table salt.

“Nobody’s done this before, to the best of my knowledge, nobody’s done this, and all of the elements in the process are reusable. It’s a very sustainable way of obtaining lithium,” he said.

 

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