Elon Musk says Tesla open to buying a mining company

FILE PHOTO: Met Gala arrivals in New York City
  • Oops!
    Something went wrong.
    Please try again later.
·2 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

By Sheila Dang

(Reuters) - Tesla Inc is open to buying a mining company if producing its own supply of electric vehicle (EV) metals would speed up worldwide adoption of clean energy technologies, Chief Executive Officer Elon Musk said on Tuesday.

Concern is mounting across the EV industry that there may not be enough supply of lithium, nickel, copper and other metals to match demand later this decade, fueling questions about whether Tesla would consider jumping into the mining sector.

"It's not out of the question," Musk told the FT Future of the Car 2022 conference. "We will address whatever limitations are on accelerating the world's transition to sustainable energy. It's not that we wish to buy mining companies, but if that's the only way to accelerate the transition, then we will do that."

While the auto giant has EV metals contracts with suppliers across the globe, its goal to produce 20 million vehicles annually by 2030 - what Musk called an "aspiration, not a promise" - will require vastly more supplies of metals. Tesla produced just under 1 million EVs last year.

Other automakers and executives including Carlos Tavares, the CEO of Tesla rival Stellantis NV, have warned the auto industry faces a metals supply shortage.

Tesla has no experience with the time-intensive and laborious task of building and operating a mine, so industry analysts have advised the automaker to focus on buying an existing operator.

Many in the mining industry have noted that buying an existing metals producer would cost far less than the $43 billion Musk offered to personally buy social media network Twitter Inc earlier this year.

Tesla has lithium supply deals with Ganfeng Lithium Co, Livent Corp and Albemarle Corp, among others. The company's lithium supply deal with Piedmont Lithium Inc PLL.O was put on hold last year.

Tesla has nickel supply deals with Vale and Talon Metals Corp.

(Reporting by Sheila Dang in Dallas; additional reporting by Alexandra Ulmer, David Morgan, Eva Mathews, Jeff Mason, Nandita Bose, Greg Roumeliotis, Katie Paul and Peter Henderson; Editing by Nick Zieminski and Leslie Adler)