Tesla will not be able to scale its manufacturing capacity
Something they don&#x27;t mention is lithium supply. According to the Financial Times[1], that&#x27;s a big problem for them:<p>&gt; Tesla will need about 24,000 tonnes annually of lithium hydroxide, according to Benchmark Mineral Intelligence, out of a market last year of 50,000 tonnes.<p>&gt; more than 70 per cent of which is found in Chile, Argentina and Bolivia. Due to growth in demand for electric batteries, the global lithium market is approaching a shortage, with no new supply coming on stream next year, say analysts. At the same time, battery factories being built in China are set to increase demand for lithium.<p>&gt; So far two companies have announced supply deals with Tesla, and neither is expected to produce substantial amounts of lithium until after 2020.<p>&gt; “The current strategy seems to be no direct investment but leveraging the Tesla name by signing ‘contingent’ contracts at unachievably low prices with junior mining companies who have never produced lithium chemicals,”<p>&gt; Albemarle of Baton Rouge, FMC Lithium of Philadelphia and SQM of Chile, the big producers of lithium, have not been willing to supply at the prices Tesla has demanded.<p>[1] <a href="http:&#x2F;&#x2F;www.ft.com&#x2F;intl&#x2F;cms&#x2F;s&#x2F;0&#x2F;4a924a64-99df-11e5-987b-d6cdef1b205c.html#axzz47yGaYlgt" rel="nofollow">http:&#x2F;&#x2F;www.ft.com&#x2F;intl&#x2F;cms&#x2F;s&#x2F;0&#x2F;4a924a64-99df-11e5-987b-d6cde...</a><p>(To get around paywall, google &quot;lithium supply tesla&quot; and take the top result.)