I bumped into a co-worker today who seemed a little too excited.
He had made a pretty penny on Tesla’s meteoric rise this year. The moment I saw him, the first thing he said was, “How much better can a car company do?”
“So you think Tesla is just a car company?” I asked.
I could see him blinking in confusion.
It turns out that Elon Musk may be even smarter than most people believe (if that’s possible).
You see, there’s one serious obstacle keeping Tesla from conquering the known world.
We’ve talked before about Musk’s Blood Metal Curse over the world’s tainted supply of cobalt. While the issue has forced major tech and auto companies to find an ethical source of this battery metal, Musk simply announced that his batteries wouldn’t use it.
Well, his current batteries will use it, but the company will just cut it out in future battery technology.
I remain skeptical, and so should you.
Regardless, both of us know that there’s an even greater looming crisis hanging over Tesla’s future.
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And it revolves around lithium.
Look, it’s not hard to see this crisis forming.
The rapid growth and adoption of electric vehicles have driven global lithium demand higher over the last decade.
Yet it’s not the past I’m concerned about.
Between now and 2025, lithium demand is projected to more than triple as more EV makers push their lines out on the road.
It jumps with every new generation of phone that comes out.
Lithium is arguably the single most important commodity in today’s technology.
I know it, you know it… and now Elon Musk knows it.
During Tesla’s Battery Day, Musk told the world about his plans to build his fifth Gigafactory in Austin, Texas.
What most investors ignored was that he also announced that Tesla was becoming much more than a simple car company.
The company intends to build its own lithium-hydroxide chemical plant, conveniently located in Texas, too.
Tesla even inked a five-year deal with Piedmont Lithium for one-third of its spodumene production each year, with the first deliveries being shipped in 2022.
Does Elon Musk finally get it?
If there was any doubt before, there certainly isn’t any now, given his plans to have Tesla build its very own lithium-hydroxide refinery in Texas.
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