Featured Image Credit: Glencore/Twitter

Tesla could be buying cobalt for its lithium-ion batteries from Glencore, according to a source familiar with the matter. The source stated that Tesla's Gigafactories in Shanghai and Berlin could get its cobalt supply from Glencore. 

According to the Financial Times, Glencore could be supplying up to 6,000 tons of cobalt a year for Tesla's lithium-ion batteries. The supply will go to EVs manufactured in Giga Shanghai and Giga Berlin. Tesla's deal with Glencore may have been well-timed because the demand for cobalt could increase as more OEMs start producing electric vehicles. 

Global Energy Metals predicted that cobalt demand could surpass 120,000 tonnes per annum by 2020. Tesla knew the strain battery electric vehicles (BEVs) could put on cobalt supply once EVs were adopted by the general public and has reduced the amount of cobalt in its batteries over the years. The EV automaker is also working on using different materials for its batteries, so it is uncertain how long Tesla's deal with Glencore will last if the rumors are true.

Tesla Semi Volume Production Confirms Battery Production Bottleneck Issue Is Solved For All Models https://t.co/vbfzud0Yy7

— Tesmanian.com (@Tesmanian_com) June 11, 2020

Bloomberg calculated that Giga Shanghai could use up to 1,200 tons of cobalt a week if it is manufacturing 1,000 to 3,000 vehicles a week. Based on Tesla China's VP Grace Tao, Giga Shanghai could reach a 4,000 per week production rate by the end of June, meaning it will need to increase its cobalt supply soon. Currently, Giga Shanghai manufactures the MIC Model 3 Standard Range+ and MIC Model 3 Long Range RWD. Its demand for cobalt could probably increase in time, although Tesla Giga Shanghai may also use cobalt-free batteries from local battery supplier CATL. 

Meanwhile, Giga Berlin is expected to produce up to 500,000 vehicles a year once it is fully operational. It is scheduled to kick off operations with the Tesla Model Y in 2021 and build up to its 500K/year goal.

More information on Tesla's batteries will be divulged during Battery Day. The event has been postponed twice due to the global pandemic but is still expected to take place by the end of the year. Information shared during Tesla Battery Day will significantly affect the company's vehicle production schedule for the next few years. So far, Tesla plans to produce the Semi, the Cybertruck, and the Plaid car series, which includes the Model S, Model X, and its EV pickup truck.