Tesla confirms deal with Vale Nickel and lists battery material suppliers

Tesla has published a list of its direct suppliers of battery materials, confirming reports earlier this year of a long-term deal with Brazilian mining giant Vale.

On page 103 of its 2021 Impact Report, in the Supply Chain chapter, Tesla lists all of its direct vendor relationships in the battery supply chain that have been active in the past year. A total of twelve companies are included in the table, including Vale, which is listed as a supplier of nickel mined in Canada from an integrated mine and processing facility.

Following Tesla’s disclosure, Vale also disclosed information about the deal in a May 6 brief statement. The company said it has signed a long-term contract with Tesla to supply grade-1 nickel to the United States from its operations in Canada.

Vale also noted that the agreement is consistent with its strategy to “increase our footprint in the electric vehicle industry by leveraging our low carbon footprint and leading market position as the largest finished nickel producer in North America.

The Brazilian company aims to secure between 30% and 40% of Class 1 nickel sales for the fast growing electric vehicle industry compared to 5%. The fact that Vale is included in Tesla’s 2021 impact report suggests that the agreement dates back to last year.

The list published by Tesla includes 12 suppliers, five of which are Chinese companies supplying lithium (Ganfeng and Yahua) and cobalt and nickel (Guizhou CNGR, Hunan CNGR and Huayou). Interestingly, CATL is not on the list.

In addition to the companies mentioned in the report, Tesla also has an agreement with Talon Metals, which will supply 75,000 metric tons of nickel concentrate from a project being developed in Minnesota. Talon Metals is not mentioned in Tesla’s 2021 impact report, as the deal was announced in January 2022.

Nickel is an important component of electric vehicle battery cathodes, and Tesla uses nickel-based chemicals for its long-range models.