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Inside Tesla’s $5 Billion Gigafactory

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Inside Tesla's $5 Billion Gigfactory

Special thanks to Lomiko Metals (TSX-V: LMR) and Global Cobalt (TSX-V: GCO) for helping us put together this infographic.

Inside Tesla’s $5B Gigafactory

With $5 billion in capital expenditures and 6,500 high tech jobs, several states continue to court Tesla Motors to build their next megaproject within their borders. The Tesla Gigfactory, slated to open doors in 2017, will set a new precedent for economies of scale in battery production.

Tesla’s new factory will produce more lithium-ion batteries under one roof than all of 2013’s global production combined. As a result, the electric car company estimates this will cut costs per kWh by 30%.

Tesla’s product strategy relies on it. The Gen III is supposed to retail for only $35,000, which is only half the cost of the more upscale Model S.

UBS notes that raw materials make up 70% of the cost of each lithium-ion battery, so sourcing and procuring these minerals will be a very important component of their overall strategy. In the infographic, we break down the potential impact this will have on these commodities. Special thanks to Simon Moores and The Gold Report, who had a great interview recently on the subject.

Graphite:

In 2013, flake graphite production was 375,000 tonnes. The Gigafactory alone would add another 126,000 tonnes (34% increase) over 2013 production. Even more significant, the increase on battery-grade graphite demand would be 154%.

Cobalt:

55% of cobalt comes from the Democratic Republic of the Congo.  Tesla says they do not source from the Congo, so this makes getting cobalt a little more difficult. 42% of cobalt demand is from batteries, making it the blue metal’s #1 use. Current Tesla batteries use about 9% cobalt by weight (NCA formulation).

Lithium:

There has been a steady supply of lithium in Chile since 1996, so this will likely be the easiest commodity to source.

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Visualizing 10 Years of Global EV Sales by Country

Global EV sales have grown exponentially, more than doubling in 2021 to 6.8 million units. Here’s a look at EV sales by country since 2011.

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Visualizing 10 Years of Global EV Sales by Country

This was originally posted on Elements. Sign up to the free mailing list to get beautiful visualizations on natural resource megatrends in your email every week.

In 2011, around 55,000 electric vehicles (EVs) were sold around the world. 10 years later in 2021, that figure had grown close to 7 million vehicles.

With many countries getting plugged into electrification, the global EV market has seen exponential growth over the last decade. Using data from the International Energy Agency (IEA), this infographic shows the explosion in global EV sales since 2011, highlighting the countries that have grown into the biggest EV markets.

The Early EV Days

From 2011 to 2015, global EV sales grew at an average annual rate of 89%, with roughly one-third of global sales occurring in the U.S. alone.

YearTotal EV SalesCAGR
201155,414-
2012132,013138.2%
2013220,34366.9%
2014361,15763.9%
2015679,23588.0%
Total sales / Avg growth1,448,16289.3%

In 2014, the U.S. was the largest EV market followed by China, the Netherlands, Norway, and France. But things changed in 2015, when China’s EV sales grew by 238% relative to 2014, propelling it to the top spot.

China’s growth had been years in the making, with the government offering generous subsidies for electrified cars, in addition to incentives and policies that encouraged production. In 2016, Chinese consumers bought more EVs than the rest of the world combined—and the country hasn’t looked back, accounting for over half of global sales in 2021.

EV Sales by Country in 2021

After remaining fairly flat in 2019, global EV sales grew by 38% in 2020, and then more than doubled in 2021. China was the driver of the growth—the country sold more EVs in 2021 than the rest of the world combined in 2020.

Country2021 EV Sales% of Total
China 🇨🇳3,519,05451.7%
U.S. 🇺🇸631,1529.3%
Germany 🇩🇪695,65710.2%
France 🇫🇷322,0434.7%
UK 🇬🇧326,9904.8%
Norway 🇳🇴153,6992.3%
Italy 🇮🇹141,6152.1%
Sweden 🇸🇪138,7712.0%
South Korea 🇰🇷119,4021.8%
Netherlands 🇳🇱97,2821.4%
Rest of Europe 🇪🇺 469,9306.9%
Rest of the World 🌍 313,1294.6%
Total6,809,322100.0%

China has nearly 300 EV models available for purchase, more than any other country, and it’s also home to four of the world’s 10 largest battery manufacturers. Moreover, the median price of electric cars in China is just 10% more than conventional cars, compared to 45-50% on average in other major markets.

Germany, Europe’s biggest auto market, sold nearly 700,000 EVs in 2021, up 72% from 2020. The country hosts some of the biggest EV factories in Europe, with Tesla, Volkswagen, and Chinese battery giant CATL either planning or operating ‘gigafactories’ there. Overall, sales in Europe increased by 65% in 2021, as evidenced by the seven European countries in the above list.

The U.S. also made a comeback after a two-year drop, with EV sales more than doubling in 2021. The growth was supported by a 24% increase in EV model availability, and also by an increase in production of Tesla models, which accounted for half of U.S. EV sales.

Tesla’s Dominance in the U.S.

Tesla is the world’s most renowned electric car company and its dominance in the U.S. is unmatched.

Between 2011 and 2019, Tesla accounted for 40% of all EVs sold in the United States. Furthermore, Tesla cars have been the top-selling EV models in the U.S. in every year since 2015.

EV Model2021 Sales% of 2021 U.S. EV Sales
Tesla Model Y*185,99429.5%
Tesla Model 3*147,46023.4%
Ford Mustang Mach-E27,1404.3%
Chevy Bolt EV/EUV24,8283.9%
Volkswagen ID.416,7422.7%
Tesla Model S*15,5452.5%
Nissan Leaf14,2392.3%
Porsche Taycan9,4191.5%
Tesla Model X*7,9851.3%
Audi e-tron7,4291.2%

*Estimates
Share of total sales calculated using total U.S. EV sales of 631,152 units, based on data from the IEA.
Source: Cleantechnica

Tesla accounted for over 50% of EV sales in the U.S. in 2021 with the Model Y—launched in 2019—taking the top spot. Furthermore, the Model Y remained the bestselling EV in the first quarter of 2022, with Tesla taking up a massive 75% of the EV market share.

Despite Tesla’s popularity, it could face a challenge as other automakers roll out new models and expand EV production. For example, General Motors aims to make 20 EV models available by 2025, and Ford expects to produce at least 2 million EVs annually by 2026. This increase in competition from incumbents and new entrants could eat away at Tesla’s market share in the coming years.

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Which Countries Produce the Most Natural Gas?

Natural gas prices have risen since Russia’s invasion of Ukraine. This visualization highlights the world’s largest natural gas producers.

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Which Countries Produce the Most Natural Gas?

This was originally posted on Elements. Sign up to the free mailing list to get beautiful visualizations on natural resource megatrends in your email every week.

Natural gas prices have risen since Russia’s invasion of Ukraine, exacerbating an already tight supply situation.

Making matters worse, Moscow has since cut gas exports to Europe to multi-year lows, sending Europe’s gas price to almost 10 times its pre-war average.

Using data from BP’s Statistical Review of World Energy, the above infographic provides further context on the gas market by visualizing the world’s largest gas producers in 2021.

Natural Gas Consumption at All-Time High in 2021

Natural gas is part of nearly every aspect of our daily lives. It is used for heating, cooking, electricity generation, as fuel for motor vehicles, in fertilizers, and in the manufacture of plastics.

The fuel is a naturally occurring hydrocarbon gas and non-renewable fossil fuel that forms below the Earth’s surface. Although the Earth has enormous quantities of natural gas, much of it is in areas far from where the fuel is needed. To facilitate transport and reduce volume, natural gas is frequently converted into liquefied natural gas (LNG), in a process called liquefaction.

Despite global efforts to reduce reliance on fossil fuels, natural gas consumption reached a new all-time high in 2021, surpassing the previous record set in 2019 by 3.3%.

Demand is expected to decline slightly in 2022 and remain subdued up to 2025, according to the International Energy Agency.

Region2021 Demand in Billion Cubic Meters (bcm)2022P (bcm)2025P (bcm)
Africa169172188
Asia Pacific895907990
Central and South America153147153
Eurasia634619632
Europe 604549536
Middle East564582627
North America1,0841,1081,116
World 4,1034,0834,243

The Asia Pacific region and the industrial sector are expected to be the main drivers of global gas consumption in the coming years

Natural Gas Production, by Country

The world’s top 10 producers of natural gas account for about 73% of total production.

RankCountry2021 Production (bcm)Share %
#1🇺🇸 United States934.223.1%
#2🇷🇺 Russia701.717.4%
#3🇮🇷 Iran 256.76.4%
#4🇨🇳 China209.25.2%
#5🇶🇦 Qatar 177.04.4%
#6🇨🇦 Canada172.34.3%
#7🇦🇺 Australia 147.23.6%
#8🇸🇦 Saudi Arabia 117.32.9%
#9🇳🇴 Norway114.32.8%
#10🇩🇿 Algeria100.82.5%
#12🇹🇲 Turkmenistan79.32.0%
#13🇲🇾 Malaysia 74.21.8%
#14🇪🇬 Egypt 67.81.7%
#15🇮🇩 Indonesia 59.31.5%
#16🇦🇪 United Arab Emirates57.01.4%
#17🇺🇿 Uzbekistan50.91.3%
#18🇳🇬 Nigeria 45.91.1%
🌐 Rest of the World671.816.6%
🌐 Global Total4,036.9100.0%

Natural gas accounts for 32% of primary energy consumption in the United States, the world’s largest producer. Russia is the second biggest producer, and also has at least 37 trillion cubic meters of natural gas reserves, the most in the world.

China’s natural gas production grew by 7.8% in 2021, and it has nearly doubled since 2011. This sustained growth in production is partly down to government policies incentivizing coal-to-gas switching.

Europe’s Natural Gas Crisis

Russia has significantly reduced flows of natural gas to Europe since Western nations imposed sanctions on the Kremlin following the invasion of Ukraine. Before the war, the European Union (EU) imported about 40% of its natural gas from Russia.

The gas is transported by the Nord Stream system, a pair of offshore natural gas pipeline networks in Europe that run under the Baltic Sea from Russia to Germany.

Russian energy giant Gazprom recently halved the amount of natural gas flowing through the Nord Stream 1 pipeline to 20% of capacity, blaming Western sanctions for a delay in the delivery in a necessary turbine. EU officials say Russia is “weaponizing” its gas supply.

Amid tensions, the EU bloc outlined a plan to phase out dependence on Russian fossil fuels. Lithuania ceased Russian gas imports at the beginning of April. Estonia’s and Latvia’s imports also dropped to zero at the start of that month. Bulgaria, the Netherlands, and Poland all announced that they do not intend to renew long-term contracts with Gazprom.

Despite these efforts, Europe remains dependent on Russia for its supply of natural gas, at least in the short and medium term.

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