Tesla's wildly popular Model 3 will require more lithium supplies for its electric batteries. Tesla Motors is currently seeking more competitive lithium suppliers for its Gigafactory.
The publication Seeking Alpha reports that Kurt Kelty, Tesla's Director of Battery Technology, announced that their future battery cells will be less expensive than current 18650s, as well as safer and larger.
Today, Tesla Motors is producing around 50,000 vehicles each year, consuming 7 GWh/year. By 2020, Tesla plans to produce 500,000 vehicles/year and for this goal the Gigafactory will have to deliver 35 GWh/year. When the Gigafactory will be complete, it will become the world's second largest building.
Tesla has a plan to reduce cell costs be 30 percent by optimizing mechanical design and cell chemistry. The company will also use a new form factor optimized for electric vehicles (EVs).
Another way of reducing costs is by optimizing processes, vertical integration and bringing the supply chain closer. For producing lithium-ion batteries at the Nevada factory for the upcoming Model 3, Tesla Motors is looking to take more low-cost supplier bids for manufacturing lithium-ion batteries.
Tesla received two earlier-stage proposals from Bacanora Minerals Ltd. and Pure Energy Minerals Limited. However, none of these companies ever produced any lithium products or conducted a feasibility study. According to the publication Hybrid Cars, industry analysts have speculated that by taking their bids Tesla intend to put pressure on established global lithium suppliers to reduce their price.
According to a Financial Post article, Albemarle Corporation, SQM and FMC Corp might become Tesla Motor's lithium suppliers. The three major companies supply 90 percent of the world's lithium. They will compete as the primary lithium supplier for Tesla's Gigafactory.
The way Tesla Motors is doing business at the battery plant in Nevada has been heavily scrutinized. The automaker is under lot of pressure from the state of Nevada. The state offered $1 billion in tax breaks to entice the automaker to choose the Nevada site for its factory. But now, Tesla is required to meet strict regulatory guidelines.
See Now: OnePlus 6: How Different Will It Be From OnePlus 5?
