Tesla Breaks Ground on Texas Lithium Refinery; Musk: Will Produce Lithium Hydroxide for 1 Million Cars a Year

Tesla CEO Elon Musk joined Texas Governor Greg Abbott at the groundbreaking ceremony for Tesla's lithium refinery, on Monday local time.
Tesla plans to invest $375 million in the plant, which will help secure its supply of lithium hydroxide within the United States. Lithium hydroxide is a key raw material for the manufacture of electric vehicle batteries as well as domestic and utility-scale batteries.
The establishment of the lithium refinery will make Tesla the only major North American automaker to refine its own lithium.
Musk said Tesla's goal is to produce enough battery-grade lithium hydroxide at the plant to supply one million vehicles per year and to produce more lithium hydroxide than all other North American refineries combined.
However, Musk also said that Tesla will continue to buy lithium hydroxide from suppliers, which include Albemarle Corp and Livent Corp.
Musk also said that Tesla aims to complete construction of the plant next year and then achieve full production in about a year's time.
The groundbreaking ceremony was also attended by Texas Governor Abbott, who praised Musk as the greatest entrepreneur on the planet.
Cleaner, more byproducts
In documents previously submitted to the Texas Comptroller's office, Tesla promised that the process Tesla will use is innovative and designed to consume fewer hazardous reagents and produce usable byproducts than traditional processes.
There were no toxic emissions or anything else - you could live in the middle of a refinery without any adverse effects. As a result, they were very clean operations, according to Musk on Monday.
"Fundamental bottleneck" in the electric car industry
In April last year, Musk said that Tesla might need to get into lithium refining because the cost of the metal has reached insane levels.
However, since Musk's comments, the prices of lithium have fallen sharply.
China still controls more than half of the world's lithium processing and refining capacity, while the US controls just 1%. Musk said the availability of battery-grade lithium hydroxide was a "fundamental bottleneck" for the electric car industry and others.
Tesla said last month that the recent plunge in the prices of lithium and other commodities would help boost Tesla's margins for the rest of the year.