If Model 3 Production Reaches 500,000 Units, The Entire Global Supply Of Lithium Would Have To Go To Tesla

By now - the computer manufacturers already have supply contracts from a number of sources - so the likelyhood that Tesla would tie up ALL the lithium in the world is NOT going to happen. At he very least - one must remember that APPLE is sitting on a cash hoard - that Tesla can only dream of. Tesla is an also ran here.

Interesting stories, no? Last year, Tesla delivered about 50,000 units in total. They allegedly have deposits for 400,000 Model 3s, based on consumers believing they can get a car for US$30,000 in the not-too-distant future. Good luck, folks.

But don't get too riled up by the story in the link. An important sentence is as follows...

“In order to produce a half-million cars per year,” Tesla CEO Elon Musk said during the March 31 debut of the Model 3, “we would basically need to absorb the entire world’s lithium-ion production.”

Does anyone believe that Tesla will go from 50,000 to 500,000 vehicles per year any time soon? It's not just a question of whether they can tool up their factory quickly enough (they can't), or secure the required supply chains not only for lithium but also other elements, like the rare earths required for electric motors, copper, gold, etc. (they can't). There's also that niggling question of customers.

Tesla ALLEGES to have 400,000 orders (almost as good as actual sales), even though:

(1) The delivery will be spread across many years (best guess as to how many)

(2) Deliveries are *said* to start in late 2017, but Tesla has a long track record for delivering late, so let's just say late 2018, or nearly 3 years out

(3) Current production capacity is at 50,000 and Tesla has not proven it can ramp up quickly

(4) The actual delivery price will likely change. Imagine putting down US$1,000 for a car you *think* you'll get near the end of 2017 for around $30,000, and then around the year 2022 (6 years out), your car is ready for you, and it costs $44,000 (less $1000 deposit). Do you think you'll feel the same then as you do now? People will change their mind.

(5) Tesla is not the only EV show in town. There are more affordable options, and yet their sales are slow. Does anyone believe Tesla has the magic formula, and somehow they've managed to inspire hundreds of thousands of people to buy an EV when nobody else can? Remember, an order -- that's what Tesla has -- is just a prospect's *intention* to buy your product. It's not an actual sale. It's not a 100% guaranteed thing. Yet readers treat orders identically to sales, and get excited by these numbers.

(6) Other manufacturers are not sitting on their butts, stagnant. You can be sure that they'll deliver new and compelling products to meet actual demand while Tesla prospects are waiting for their orders to be fulfilled... in 3 to 9 years.


Let's give this story time to play out, and reassess Tesla periodically in the coming years.

Your disdain for Tesla is on full display once again. It's sad that people like you would cheer the demise of an innovative new American company. Sorry to disappoint you but it's not going to happen.

@runninglogan1 How exactly is Tesla innovative? Its EV technology is no more impressive than that of a Chevy Spark EV, et. al.

If you believe that stupidity (and I doubt that you do) then you also believe that the SpaceX Falcon 9 is no more impressive than the firecracker you set off in your back yard last weekend.

Ever heard of a smart fuse? Or using silicone in the anode of a car battery? Or the constantly updated and peerless Autopilot. Or... Don't really have time to educate you on Tesla innovations. Do a little research or better yet, stop talking out of your ass.

Elon Musk is the new Sergio Marchionne

And I'm Orville Redenbacher.

@runninglogan1 No, you're more like Sergio Marchionne himself.

Watch how Netflix deflated today....in a single session Wall Street noticed that it was NOT a tech company but just another distribution/entertainment company. The same will happen with Tesla when the analyst and the public finally realize it also is NOT a tech company, just a slightly different car manufacturer without any chance of financial success!

Lithium mining is on the upswing here in the US, curiously as a result of CO2 sequestration efforts in finding underground spaces to store this greenhouse gas. Massive lithium brine deposits were found in Wyoming and Nevada, enough for over 1000 years supply for the USA. Of course it will take time to extract the lithium from underground, but it is still there. Lithium mining is also on the major upswing worldwide, notably in Argentina, China, Canada, and Russia. The idea that we are going to "run out" of lithium is not realistic. Prices have been rising, and as prices rise for this element, mining for it will only increase.

Sounds like the article was written by some Detroit-based hack wearing a GM sweatshirt.

I don't have to read it, whoever wrote it is is irrelevant.
Tesla is not innovative at all. Lithium Ion is so 10 years ago.. Gigafactory will be obsolete when it finally opens