Business

Tesla shares: Company considers Texas Lithium Refinery, as China controls global capacity

Tesla (TSLA) is eyeing the prospect of building a lithium processing facility in Texas, as the company wants more control over key manufacturing components amid soaring prices. Tesla shares rose on the news.




X



In documents sent to the Texas Executive Office, the electric vehicle manufacturing giant of Elon Musk is evaluating the facility – where lithium hydroxide will be refined – on the Texas Gulf Coast. Reuters first reported on the submission of the documents.

Tesla says the facility will develop “battery-grade lithium hydroxide” and process “raw ore material into a state that can be used to manufacture batteries,” the company filing says. The company added in a letter to the Texas Comptroller’s Office that the plant will be the first of its kind in North America.

If the project goes through, Tesla says it could begin construction in the fourth quarter, with commercial production slated to begin by the end of 2024.

Tesla added that it was simply “assessing the feasibility of this project” and that “only very preliminary development activities will begin,” the filing said.

Who controls Lithium?

The price of lithium has increased by about 120% by 2022, according to Benchmark Mineral Intelligence. Some analysts estimate this price increase could add about $1,000 to the cost of a new car.

Most of the world’s lithium is located in an area of ​​South America known as the “Lithium Triangle”. This region includes Chile, Bolivia and Argentina. About 58% of the world’s lithium resources are found in these three countries, according to the 2021 U.S. Geological Survey’s Mineral Commodity Compendium.

Currently, China is constrained in terms of the world’s lithium refining capacity, which will account for about 75% of global production by 2021, according to the Internal Energy Administration.

With Tesla looking to build its own refinery in North America, it could challenge China’s dominance. Meanwhile, it can also take advantage of billions of dollars in EV . incentives in the recently signed Inflation Reduction Act.

There are standards EVs must meet to qualify for the tax credit. By 2024, EV batteries must have at least 40% of minerals mined or processed in the country. Another option is a country with a free trade agreement with the United States. This number will increase to 80% by 2027.

If Musk goes ahead of schedule, the lithium refining operation will go live in 2024. During Tesla’s second-quarter earnings call in late July, Musk hinted to investors that the company could get in. into the lithium business.

“I really want to encourage, again, entrepreneurs to get into the lithium refining business. You can’t lose. It’s a license to print money,” Musk said.

Tesla shares

Tesla shares were up about 1.5% ahead of Friday’s trading session. Shares rose nearly 2% to 289.26 on Thursday in market tradingand is currently moving up towards its 200-day moving average.

CNBC reported Thursday night that there was a leadership change at Tesla’s Gigafactory, a large battery factory in Nevada. Chris Lister, the former executive vice president of Gigafactory, has left Tesla. Hrushikesh Sagar has been promoted to oversee the Gigafactory, according to CNBC.

Sagar reports directly to Musk and will oversee Tesla’s vehicle assembly plant in Fremont, California, along with the Gigafactory.

Meanwhile, local media in Germany reported that the country’s federal motor transport regulator had discovered “abnormalities” during its investigation into Tesla’s autopilot capabilities.

German regulators have been looking at Tesla’s automatic lane change feature since the beginning of the year. There is concern that this device may be illegal in Europe.

Please follow Kit Norton on Twitter @KitNorton for more insurance.

YOU MIGHT ALSO LIKE

What is SLIM CAN? If you want to find winning stocks, know better

Top Funds Buy To Be The #1 Industry Leader About To Break Out With 364% Growth

Trade with the pros on IBD Live

Gain an edge in the stock market with IBD Digital

Market Rally Running Right Resistance; 2 former leaders dance

Source link

kignews

Kig News: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, Sports...at the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button