Tesla Gigafactory Spurs Lithium Producers To Boost Output For Batteries


Tesla gigafactory as photographed by drone, May 17, 2015 [screen capture from YouTube video]

Tesla gigafactory as photographed by drone, May 17, 2015 [screen capture from YouTube video]

The Tesla Motors "Gigafactory" currently under construction outside Reno, Nevada, is billed as the largest lithium-ion cell and battery production factory plant in the world.

Electric-car maker Tesla hopes that producing battery cells on such a massive scale will allow it to achieve a $35,000 base price for its planned 200-mile Model 3 electric car, and supply cells for energy storage as well.

But building lithium-ion cells in heretofore unknown numbers will require more of the raw materials needed to make them.

DON'T MISS: Tesla Gigafactory: Drone Flyover Shows How Huge It Really Is

So as Gigafactory construction continues, a pair of lithium producers are weighing new plants as well, according to Bloomberg.

Albemarle Corp. is considering building a new plant to make lithium hydroxide, the form of the metal used in electric-car battery cells, CEO Luke Kissam said.

FMC Corp. is also mulling a new lithium-hydroxide plant, and will decide within a year, Pierre Brondeau--its CEO--said.

Tesla battery gigafactory site, Reno, Nevada, Feb 25, 2015 [photo: CC BY-NC-SA 4.0 Bob Tregilus]

Tesla battery gigafactory site, Reno, Nevada, Feb 25, 2015 [photo: CC BY-NC-SA 4.0 Bob Tregilus]

Both companies expect to build their new plants in Asia or the U.S.

Anticipated demand for battery-making materials from Tesla and potentially other companies is driving their thoughts of expansion.

Philadelphia-based FMC presently controls half of the world's lithium-hydroxide production.

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But demand from Tesla could require it to expand production capacity as soon as 2017, CEO Brondeau said. The company will decide on whether and how to do so by mid-2016.

Meanwhile, Baton Rouge-based Albemarle is already planning a plant that converts Spodumene (a mineral containing lithium, aluminum, and silica) directly into lithium hydroxide--eliminating a step in the process.

Spodumene is typically converted into lithium chloride before being changed to lithium hydroxide.

Tesla battery gigafactory site, outside Reno, Nevada, Jan 6, 2015 [photo: Bob Tregilus]

Tesla battery gigafactory site, outside Reno, Nevada, Jan 6, 2015 [photo: Bob Tregilus]

Albemarle also plans to begin production later this year at a new plant in Chile that can yield 20,000 tons of battery-grade lithium chloride per year from brine.

Production at that plant won't fully ramp up until 2017, though.

That's the same year that cell and battery production at the Tesla Gigafactory will need to hit full swing to support the launch of the Model 3 electric car, now expected that year or in 2018.

MORE: Will Tesla Model 3 Electric Car Hit 2017 Production Date?

Tesla has said it will launch the smaller electric sedan in 2017, although the company hasn't met any of its own announced dates for vehicle introductions as yet.

Indeed, Tesla may face a decision on how to allocate its gigfactory output between present and future vehicles and its various energy-storage products.

The company reportedly has 38,000 orders for its Powerwall home battery packs globally, and 2,500 orders for its commercial Powerpack batteries.

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