Tesla looked into buying a share in this Swiss mine company to ensure the supply of EV batteries.
Glencore Plc and Tesla Inc. (NASDAQ: TSLA) spoke about Tesla Inc. buying a stake inside the Swiss commodities company.
According to the Financial Times, the conversation illustrated how international automakers seek to establish relationships with the mining sector in order to obtain the supplies required for the introduction of electric vehicles. Initial talks regarding Glencore purchasing 10–20% of Elon Musk’s electric vehicle and battery manufacturer started in 2021.
As part of a roadshow again for the mining company’s annual results, Glencore CEO Gary Nagle attended Tesla’s facility in Fremont, California, in March 2022.
Tesla was hesitant to acquire a minority ownership investment because it questioned if Glencore’s vast coal mining operations were consistent with the automaker’s environmental objectives.
Concerns about ensuring supply of raw minerals like cobalt, lithium, as nickel have been raised as the popularity of electric cars has increased among automakers and battery manufacturers.
Tesla plans to have more control over all aspects of battery production, including the processing of raw materials or even purchasing lithium mines that are still in the ground, according to Musk.
Unless costs decrease, Musk said, “Tesla could potentially have to enter the mining & refine directly at scale.”
Since the beginning of 2021, the cost of lithium has increased eight-fold.
The construction of Tesla’s lithium hydroxide refinery just on Texas Gulf Coast is now moving forward.
One of the biggest battery recyclers in the world, Glencore also manufactures cobalt, nickel, copper, as well as other minerals.
Analysts have expressed skepticism about Musk’s willingness to invest with mining companies or trading firms, claiming that his statements were intended to startle suppliers of raw materials into raising output.
Without a deal, the negotiations came to an end.
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