Tesla extends lithium hydroxide supply agreement with China’s Yahua Group until 2030

Tesla has extended its lithium hydroxide supply agreement withChina’s Yahua Lithium Industry Co., Ltd. This renewed contract is set to run from August 1, 2023, to December 31, 2030.

The initial agreement between Tesla and Yahua Group was signed on December 29, 2020, for the supply of battery-class lithium hydroxide from 2021 to 2025. Under the renewed agreement, both parties plan to build upon the foundations laid by the original contract to ensure a steady and reliable supply of lithium hydroxide, a crucial component in producing lithium-ion batteries.

From 2023 to 2030, the total volume of lithium hydroxide supplied is expected to be between 207,000 tonnes to 301,000 tonnes. (via Sina)

The extended agreement with Yahua Group not only ensures a stable supply of lithium hydroxide for Tesla’s expanding fleet of electric vehicles (EVs) but also aligns with Tesla’s mission to accelerate the world’s transition to sustainable energy. By securing a long-term supply of this critical material, Tesla can continue to scale its production and meet the growing demand for EVs, further reducing global reliance on fossil fuels and combating climate change.

Tesla has diversified its lithium supply chain over the years by establishing agreements with other major lithium producers, ensuring a stable supply immune against market fluctuations and geopolitical challenges.

Tesla is also moving lithium processing in-house, with the company currently building a battery-grade lithium hydroxide refining facility in Texas to support the processing, refining and manufacturing of battery materials for the automaker’s battery production.

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