June 2018 – Musk wants cobalt out of Tesla batteries
In response to concerns over the ethicality of cobalt mining, particularly in the Democratic Republic of the Congo (DRC), Musk tweeted in 2018: “We use less than 3% cobalt in our batteries & will use none in next-gen”, signalling Tesla’s desire to move away from a reliance on cobalt in future batteries.
Cobalt is a key component in batteries, but questions over its sourcing and potential human rights violations in areas in which it is mined heavily have labelled it the “blood diamond of battery metals”. Compounding this is its heavy demand not just from electric vehicle manufacturers, but also tech giants including Apple and Samsung, whose considerable purchasing power further adds to supply concerns. For these reasons, there has been a lot of enthusiasm for attempts to create zero-cobalt batteries.
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June 2019 – Tesla could “get into the mining business”
During Tesla’s annual shareholder meeting in June 2019, Tesla CEO Elon Musk bemoaned the low supply of nickel, lithium, copper and other metals used in batteries as a barrier to growth. In the meeting, Musk was discussing plans for Tesla’s electric pickup truck and plans to begin production of the company’s all-electric Class 8 semi-truck by the end of 2020. Musk said, however, that those plans were contingent on the company’s ability to scale up production of lithium-ion batteries.
“There’s not much point in adding product complexity if we don’t have enough batteries,” Musk said at the time. “That is complexity, but without gain.”
Once Tesla was able to increase its factory production to a “very high level”, it could “look further down the supply chain and get into the mining business,” TechCrunch quoted Musk as saying in the meeting.
“I don’t know, maybe a little bit at least,” Musk added.
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By GlobalDataFebruary 2020 – Tesla signs deal for cobalt-free batteries
In February, Reuters reported that Tesla was in “advanced talks” to use batteries from Chinese battery producer CATL that contain no cobalt for the company’s cars built in Chinese factories. The deal going ahead marked the first instance of a US car company using lithium iron phosphate (LFP) batteries in its cars.
The move came amid Tesla seeking to lower its battery costs and faltering electric vehicle sales in the Chinese market. These cobalt-free batteries have the potential to reduce the costs of electric vehicles – a longstanding mission for Tesla – potentially bringing them to prices more in line with traditional automobiles.
Despite the cost advantage offered by LFP batteries, work is ongoing to increase their driving range, which is less than that of batteries made using nickel and cobalt. This can be cost-effective in China where drivers tend to make shorter trips around cities; LFP batteries already power most of China’s electric bus fleet. In the North American and European markets, though, vehicles need a longer range.
June 2020 – Tesla and Glencore sign cobalt deal
In June, Tesla secured a deal with Glencore whereby the miner would supply as many as 6,000 tons of cobalt a year to Tesla for its lithium-ion batteries. The deal came as a huge boost in securing a strong supply of the metal, which remains an important component in those longer-range electric vehicle batteries.
Despite ethical concerns over cobalt mining, Tesla said it would support sourcing the metal from the DRC if it could be assured that the raw materials are coming from operations that meet social and environmental standards, the Evening Standard reported.
July 2020 – Musk promises “giant contract” for nickel
In an earnings call for Q2 2020, Musk pledged a “giant contract for a long period of time” to any company that could extract large quantities of nickel in an efficient and environmentally responsible manner.
Musk warned that the cost of batteries remained a barrier to Tesla’s growth, and hindered its mission to produce affordable electric vehicles. “Tesla will grant you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way,” Musk said.
Nickel makes batteries energy-dense, meaning they can be smaller, lighter, and last longer between charges. Sourcing enough of the metal is vital for the mass-adoption of electric vehicles, and Musk wants to be seen to be sourcing the metal responsibly.
September 2020 – Tesla joins Fair Cobalt Alliance
In September, Tesla backed a new initiative to support artisanal cobalt miners in the DRC. The Fair Cobalt Alliance (FCA) also has the support of Glencore as well as Chinese cobalt refiner Zheijang Huayou Cobalt. The FCA was founded as electric vehicle producers and miners aim to reassure customers about the ethical sourcing of cobalt.
The country produces almost three-quarters of the world’s cobalt supply, and there are concerns that the metal’s murky supply chain means that production from artisanal or small-scale mines – with less clarity around working conditions and ethics – could find itself mixed in with industrial output from the likes of Glencore.
Members of the FCA are aiming to boost the appeal of the country’s cobalt by working to support small-scale mines in improving working conditions and ending the use of child labour.
