This doesn’t mean Elon Musk is a saint or some kind of savior, no. He’s a successful businessman. He got in a fight with a very conservative industry, threw everything he got at it, and managed to rise to the top. This is something that most of us will never achieve. It requires personal sacrifice, incredible determination, and a very keen sense of humor. After all, nobody can refuse laughter in the face of danger or failure.
While he’s the most easily identifiable Tesla figure, we should also give props to those that helped Elon Musk in his endeavors, including the first two co-founders. What this American EV maker achieved is not something that can be done alone or with just a few partners and several employees. The success of this now global brand is something that everyone shares: from customers and investors to enemies and taxpayers. How this sharing is done… Well, that’s a topic of discussion for some other time.
It's hard to summarize so briefly this man’s impact on the auto industry. Furthermore, we can just imagine what he’ll be able to do with SpaceX. At the least, he could open new doors for space exploration and cement America’s global role in this soon-to-be vital sector. Let’s just agree he’s done a lot, and we should be grateful he’s still sane. A couple of memes and some cryptocurrency tweets didn’t and won’t hurt anybody.Tesla’s big push
You might wonder now why this piece about Tesla's journey to undeniable success started with praise for Elon Musk and those that believed in him. Well, it was done for a very simple reason: before I became a journalist, I read and saw how the media treated this man. He was mocked, belittled, accused of crazy things, and was always put in the spotlight for something weird. The public was rarely able to learn something useful about Tesla's CEO.
His business-oriented mind, however, never betrayed him. Legacy automakers laughed at Tesla and its all-electric cars. A couple of years later, they started buying carbon credits from the same company. Now everyone’s looking to beat or be better than Tesla. The tables have indeed turned.
While Ford might have a chance at competing with Musk’s company thanks to its F-series trucks, Europeans are lagging. That may be why Mercedes-Benz and BMW are already trying things out with hydrogen. Not because they like it very much, but they fear what the EV battle for resources might mean for their survival. And here shines Tesla once again - because it already decided what it wants to be.
Just today, we found out the EV maker closed a secret deal for nickel with a mining company from Brazil. This is extremely important. The demand for all-electric cars has skyrocketed across the globe, and Tesla wants to make its customers around the planet happy. With more deliveries, the chances to have more orders increase. Furthermore, Musk and his team knew very well not to trust Russia, which is the world's largest nickel producer. They've weaponized natural gas. Nothing will stop them from using the same tactics on something similar in the future.
This month we’ve also learned that Tesla is accumulating cash “at a faster pace than its ability to grow physically.” Remember when cashflow problems were all the media reported about Tesla?
So, for now, we know a couple of things: Musk is a great businessman and a good leader, Tesla is doing more than fine and is growing rapidly, its competitors are struggling, and the carmaker wants to do even more than it currently can.
Enter “Master Plan Part 3.”The final blow
There’s no need to speculate about what Elon Musk might be thinking or preparing right now. “Scaling to extreme size” sounds fun and a little bit menacing, but let’s talk facts and try to guess the next all-important move.
Tesla’s CEO might’ve announced on Twitter that he’s ready to take the company to the next level, but here’s what will give it the best shot at doing that. It’s not a marketing stunt, a new car, or another plant. It’s far more important than this.
Adam Jonas is the head of Morgan Stanley's auto and space research. According to his briefing about what Tesla’s plans are, we should get ready to witness a major victory for the EV era. If this will be done right, then Musk’s company will easily become the number one auto manufacturer. If you’re thinking about the newly requested stock split right now, too, then we’re on the same page. Things click together right about now, don’t they?
Jonas argues the “Master Plan Part 3” will include a huge change regarding the EV supply chain. He says that the next winners will be those “with the ability to buy the commodities in the highest volume and be guaranteed supply,” with “unlimited capital” being a “critical ingredient.” Essentially, this means that companies must get their hands on raw materials fast, easily, and for the right price if they want to succeed. Tesla perfectly fits this description and looks as ready as ever to seize this opportunity.
If you’ve been around for longer than me, then you might remember Ford’s adventures in South America. The company wanted to secure its own resources and heavily invested in developing entire villages close to mines or around forests. Fordlandia was just a preview for what’s to come now.
Pushing for manufacturing EVs without delays and with costs under control, Blue Oval City appeared. The $11.4 billion investment will help Ford in dealing with its aspirations as an EV maker. The company’s CEO even said that solving this issue must happen as soon as possible because “we don’t have much time.” And, boy, was he right!
With the Brazilian deal in place and prices of lithium skyrocketing, Tesla is now looking forward to securing its own raw materials for batteries – the key to long-term success.Get it done
Having the funds ready and an important partner that might be willing to let go of its operations, Elon Musk is on track to become the one who signs the contract of the decade. Albemarle is the world’s largest lithium producer and is already working with Tesla. It will surely be asked to give in to what the American carmakers want because it makes the most sense right now. Why not join forces with your biggest client? There's nothing to lose! Knowing how the American manufacturer is doing business nowadays, a transaction like this would be of no surprise. I would even go as far as saying that it is most likely already in the works.
Having a secure supply chain and cheap raw materials will turn any EV maker into an almost instant champion. With Albemarle having mines or processing plants on every continent except Africa, integrating it into Tesla’s own corporate group is a no-brainer.
As of now, Albemarle doesn’t want to give more of its products to Tesla. As with any other business out there, it’s in its best interest to have a diversified customer portfolio. But Musk’s company is pushing to ensure its own success, so the lithium provider might soon become a part of the global transformation of personal transport.
If Tesla pulls this off, then it will become unbeatable. Not only will it offer better-priced cars after securing much cheaper raw materials for batteries, but it will also choose who gets leftovers from them. It will be fantastic to witness how the American carmaker will transform itself and the whole industry.
That being said, you should bear in mind this is not confirmed. This transaction might happen, or it might not even get to the negotiation phase.
If this scenario goes as expected, then get ready for the battle that'll make automated driving and artificial intelligence the most important things a carmaker would like to have. Tesla has already harnessed enough data from its customers, and it collects more of it as each day passes.
Elon Musk will most likely get his much-wanted crown, which will sit nicely on Tesla. He never liked to show off anyway.