An anonymous source within Tesla (allegedly a VP) has confirmed the persistent rumors that the company is moving forward with a highly ambitious and unconventional plan for expanding its battery manufacturing capacity. If successful, the project has the potential to end the bottleneck that’s threatened to prevent the company from meeting the explosive demand for its cars and trucks. The highly placed Tesla insider said, in order to avoid any further delays to his plan for world domination, Tesla CEO Elon Musk, has ordered the creation of a floating battery-manufacturing complex that incorporates its own lithium mining operations.
Tesla's dilemma is not unique. In these early days of the electric-vehicle (EV) boom, every auto manufacturer has had difficulty sourcing enough lithium batteries. Some, like General Motors, have inked priority supplier agreements where they “pull” as many batteries as they need from LG Chem for production of the Chevy Bolt EV, leaving the likes of Volkswagen, Hyundai, and others to pick up whatever excess cell production is available. This has caused vehicles like the Kona to be limited in supply and Volkswagen to slide the introduction of its ID3 EV to a point in time where LG’s manufacturing capacity expansion can pace their needs.
Gigafactories and Mines
Tesla' partnership with Panasonic that resulted in the original “Gigafactory” concept has helped keep those shortages at bay—at least for the short term. The first GigaFactory, located near Reno, Nev., is a massive operation, where raw materials, cells, modules, and battery packs (and, according to locals, assemblies for an undisclosed secret project) are made under the same roof.
Tesla expanded its vertical integration strategy to include assembly of the vehicles themselves in Shanghai’s Gigafactory 3, Berlin’s Gigafactory 4, and a yet-to-be-selected Cybertruck & Semi Gigafactory 5 that Elon Musk has tweeted will be somewhere in the U.S. Midwest. According to this story's primary source, Gigafactory 5 will also be the first high-capacity facility for manufacturing dry-cell battery packs based on the technology it acquired in its purchase of Maxwell technology. This corroborates the observations of several industry observers who say that the new batteries are essential for giving the Semi and the pickup an acceptable range when they are heavily loaded.
Although Tesla's manufacturing initiative solves one problem, it puts an even greater strain on the raw materials supply chain it needs to make several billions of 21700 cells required annually. It’s been previously rumored that Musk has been trying to solve this problem by partnering directly with one or more lithium mining operations.
While accompanying Musk on a tour of one of those lithium mines, our source reports to have heard Musk remark that there might be a better way to obtain the vital element. Upon being told that the lithium deposits being mined were not veined minerals, but rather deposits from ancient inland seabeds that once covered North America and China, he began to quietly investigate mining the ocean itself.