What's going on?
Leading electric carmaker Tesla held talks with Swiss mining giant Glencore about taking ownership in the company, according to details out on Monday.
What does this mean?
Tesla’s already cemented a deal to buy cobalt – a key ingredient in EV batteries – from Glencore, but it looks like the OG electric carmaker was recently angling for a direct stake. That could’ve been a savvy move: a lot of the materials used to make EV batteries are found in less stable parts of the world, and this year’s war in Ukraine has shown us how quickly supply chains can be disrupted by geopolitical instability. Tesla, then, might have been looking to one of the world’s biggest mineral producers in a bid to further shore up supply. But it seems like Glencore’s coal mining activities – a blow against Tesla’s decarbonization goals – stopped any deal from getting over the line: Musk might be many things, but a hypocrite isn’t one.
Why should I care?
Zooming in: Focus, Elon.
Tesla’s always been a bit of a one-man show, and shareholders are getting worried that the one man in question is more focused elsewhere: Twitter. So the news that Tesla was lining up a stake in Glencore will do little to calm those nerves. After all, Musk does nothing by halves, and a minority stake might have just been the beginning.
Zooming out: Two birds, one stone.
Extracting materials for EV batteries is dirty business, so buddying up to mining firms might seem like a seedy slant for Tesla’s image. But if Musk uses any potential involvement to push the ugly business in a less ugly direction, he could fix an ongoing supply chain problem and try to tidy up the industry’s image in one fell swoop.