Tesla contemplating lithium refinery in Texas, seeks tax aid By Reuters

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© Reuters. The TESLA emblem is seen exterior a dealership within the Brooklyn borough of New York Metropolis, U.S., April 26, 2021. REUTERS/Shannon Stapleton

(Reuters) -Tesla Inc is contemplating establishing a lithium refinery on the gulf coast of Texas, because it appears to safe provide of the important thing part utilized in batteries amid surging demand for electrical automobiles.

The potential battery-grade lithium hydroxide refining facility, which Tesla (NASDAQ:) touted as the primary of its form in North America, will course of “uncooked ore materials right into a usable state for battery manufacturing”, the corporate mentioned in an utility filed with the Texas Comptroller’s Workplace.

A choice to put money into Texas will even be based mostly on the flexibility to acquire aid on native property taxes, Tesla mentioned.

Chief Govt Officer Elon Musk has mentioned beforehand that Tesla might need to enter the mining and refining trade instantly at scale as lithium costs surge.

Musk has additionally been vocal in regards to the want for extra gamers within the lithium refining trade. “You may’t lose. It is licensed to print cash,” he had mentioned on the firm’s second-quarter earnings name.

Securing a gentle provide of battery elements is seen essential for Tesla because it faces fierce competitors within the fast-growing marketplace for electrical automobiles.

If accredited, building might start within the fourth quarter of 2022 and would attain industrial manufacturing by the top of 2024, Tesla mentioned within the utility dated Aug. 22.

Below the plan, Tesla will ship the ultimate product from the refinery by truck and rail to numerous Tesla battery manufacturing websites supporting the provision chain for large-scale and electrical car batteries.

Tesla additionally mentioned it could use much less hazardous reagents and create usable byproducts as in comparison with the traditional course of.

LITHIUM SCRAMBLE

Lithium costs have skyrocketed this 12 months as a result of surging demand from the auto sector. China stays the world’s largest lithium processor, although proposed rival tasks in the USA and European Union have confronted a spread of setbacks.

If Tesla’s plan goes forward, the carmaker might develop into the primary within the sector to take a position instantly in lithium refining as automakers scramble to sew up offers with miners and refiners.

Battery makers are additionally seeking to improve manufacturing in the USA, the place a shift towards EVs might improve because the nation implements stricter regulation and tightens tax credit score eligibility.

Tesla itself signed a five-year provide cope with Australia’s Liontown Assets earlier this 12 months, whereas rival EV makers Stellantis and Byd have invested in miners world wide.

CATL, the world’s largest battery maker, has additionally taken stakes in lithium miners.

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