Tesla Plans to Open a Lithium Refinery in the USA After Imposition of New Restriction on China

Houston (TX): Market experts reported on October 20, 2022, that Tesla moved forward with plans to build a Lithium refinery in the Texas Gulf Coast region to gain more control over the Electric Vehicles (EVs) battery supply chain. Tesla Inc CEO Elon Musk confirmed the plan during a Wednesday conference call in response to questions from analysts about progress in the development of the latest 4680 battery technology. Austin, Texas-based Tesla has been considering this project for months but has previously considered at least one other location in Louisiana. Furthermore, the company told the state authorities to build a battery-grade Lithium Hydroxide refinery near Corpus Christi.

Musk added that the Lithium prices are "absurdly high" and has repeatedly encouraged entrepreneurs to start refining Lithium to ease the supply bottlenecks for the vital raw materials utilized in EVs Lithium battery manufacturing. This development came after the announcement of new restrictions or sanctions by US President Joe Biden's administration. The mass departure of the American workforce has disrupted China's Semiconductor industry. The trade war between these two economies has remained consistent since the Trump administration was in power.

Furthermore, the new export controls limit China's ability to "purchase and manufacture certain high-end chips used for military and R&D purposes" according to the state, this move was necessary to protect US national security and foreign policy interests. In addition, the requirement of license permission from the US Department of Commerce is needed before assisting and helping to showcase any support to the Chinese plants.

As per the ChemAnalyst Pricing Intelligence, some developments from the Chinese front might be a retaliatory measure that likely to impact the operations of Chemical and Non-Chemical based manufacturing facilities of the US market participants. China is a major hub for essential battery materials amidst its enormous domestic capacity. Therefore, it has been anticipated that the Chinese authorities might hinder the transition toward cleaner energy.