Lithium prices rise again, and Tesla may have to personally go mining.
Recently, Tesla CEO Musk said on the Twitter account that Tesla may directly involve in lithium mining and refining business on a large scale, because the cost of key energy metals for manufacturing batteries is already too high.
Musk tweeted, "The price of lithium has reached crazy levels. Although lithium itself is not in short supply and is almost everywhere on the earth, the rate of mining and refining lithium is very slow. ”
Lithium is the key metal material when manufacturing batteries, due to the small density, used as a battery raw material can store more electrical energy under the same weight, so lithium batteries have become the mainstream battery type of electric vehicles, and a large number of demands have driven the price of lithium to rise year by year. The data shows that lithium prices have soared by 490% in the past year.
The rise in raw materials is due to the superposition of multiple factors.
According to the analysis of Huatai Securities, lithium resources with a development cycle of up to 3-5 years have formed a bottleneck on the supply side, superimposed on the development of downstream new energy vehicles to increase demand significantly, demand is rigid and high growth certainty is strong, supply and demand mismatch dominates the lithium price center continues to be at a high level, and it is not excluded that there are speculation factors such as procurement and hoarding for speculative purposes.
In fact, this isn't the first time Musk has proposed that Tesla will mine its own lithium. In 2020, after a failed deal to acquire a lithium mining company, Tesla acquired a right to mine lithium in Nevada.
Obviously, Tesla has realized that it can't rely entirely on upstream companies that rely entirely on supply chains to expand rapidly to meet its own needs. As Tesla's production scale expands, it is imperative to control the upstream raw material supply chain. At the same time, Tesla is also developing new lithium refining technology.
The soaring price of lithium metal reflects the strong demand for electric vehicles in the market, the cost of batteries has risen, and the price of electric vehicles has risen with the water. According to incomplete statistics, since the beginning of this year, 17 new energy vehicle brands and about 50 electric vehicles have implemented price increases.
Morgan Stanley expects that this will further reduce the profits of car companies and even lead to a collapse in demand. Because lithium batteries are the most expensive components of electric vehicles, analysts estimate that car companies will need to raise the price of electric vehicles by 15% to maintain the cost structure.
It is worth mentioning that on April 8, Musk said at the Opening Event of the Texas factory that Tesla's main task this year is to expand production capacity, the production capacity target of the Texas factory is 1 million vehicles per year, and Tesla will occupy 20% of the global electric vehicle market in the future. Next year, Tesla is ready to launch three new models in one go: the Pickup Truck CyberTruck, the Truck Semi, and the Roadster 2.
Tesla delivered 936,000 electric vehicles worldwide in 2021 and 310,000 in the first quarter of this year, a new high. However, Bloomberg New Energy Outlook estimates that 1 million electric vehicles will enter the market every month in the second half of 2022, and the global electric vehicle ownership will exceed 20 million in June this year, which means that Tesla's production capacity is still facing challenges.