News
Tesla’s years of battery tech investments are becoming a buffer against nickel’s rising costs
For years, Tesla has invested heavily in its supply chain and battery strategy. So focused was the company in these endeavors that it even decided to design and produce its own batteries, the 4680 cells. The next-generation cells are a crucial component of Tesla’s long-term plan to make electric vehicles more affordable.
Elon Musk has been very open about Tesla’s need for nickel. Being a key component of its high-performance batteries, Musk stated back in 2020 that any company that can provide Tesla with environmentally-friendly nickel would be granted with a massive contract. During Battery Day, the CEO also highlighted that Tesla’s nickel-based 4680 batteries would be the heart of the company’s flagship products, like the Cybertruck.
But while nickel is a critical ingredient of lithium-ion batteries, experts have predicted an upcoming shortage for some time. Norway-based energy analytics firm Rystad Energy estimated that demand would surpass nickel supply around 2024, and by 2026, there might be a shortage of the material. This timeframe seems to have been accelerated by Russia’s invasion of Ukraine.
It should be noted that Russia controls 20% of the supply of the industry’s highest-grade nickel. The country also holds 10% of the world’s overall nickel supply. Thus, when Russia was hit by sanctions due to its invasion of Ukraine, the markets reacted. Nickel prices rose so much that the London Metal Exchange canceled trading for the material for more than a week. In a statement to Insider, auto industry analyst Lauren Fix noted that Russia’s control of nickel could have adverse effects for electric vehicle makers.
“Relying on your enemies to supply you with critical materials is never to your benefit. They have the ability to control the price you pay and can make it more difficult for you to gain supply to meet your goals,” Fix said.
Tesla is the market’s dominant electric vehicle maker, and for good reason. For years, the company has initiated plans to be as immune as possible from market shifts. Tesla built up a nickel supply practically independent of many market shifts by tapping into partnerships with nickel-mining companies and nickel production entities. The company even bought into a nickel mine in early 2021, providing itself with direct access to the material.
Tesla has also worked heavily in its battery technology, from the 2170 cells currently being made in Gigafactory Nevada with Panasonic to the 4680 cells that are currently being ramped in the company’s Kato Road facility. Tesla’s 4680 batteries were announced as nickel-based cells, though they feature a number of efficiencies that make their production more cost-effective and their life cycle longer compared to traditional batteries.
Interestingly enough, Tesla is not keeping its 4680 battery technology all for itself. In a previous announcement, Panasonic has confirmed that it would also be producing 4680 batteries, and they have already been validated by the electric vehicle maker. Panasonic has noted that mass production of the next-generation cells would begin around 2024.
Tesla also managed to handle the rising cost of nickel by using batteries that do not use the material at all. As per CEO Elon Musk, Tesla has started focusing on using iron-based batteries for its entry-level vehicles like the Model 3 RWD and the Model Y RWD, both of which are produced in Gigafactory Shanghai. The company has also mentioned that it had begun using manganese for some of its batteries to help reduce its reliance on nickel. Lastly, Tesla also launched a recycling program for its nickel-based batteries, which should help the company’s supply chain further in the future.
Tesla is still affected by shifts in the market. The fact that the company has raised its vehicle prices twice in recent weeks is proof of that. However, a number of experts have stated that Tesla’s forward-looking strategy still makes the company well-positioned to continue in its role as the undisputed leader in the electric vehicle industry. Tien Wong, a tech investor and the founder of Connectpreneur, shared his thoughts on the matter.
“Prewar, nickel prices, and potential shortages were a huge concern of Elon’s and the EV industry as a whole. The war will exacerbate these dynamics, which will result in higher prices and slower deliveries for EVs. As for Tesla, they are the market leader right now, so the nickel situation may actually help them versus competitors in the short run,” Wong said.
*Quotes courtesy of Insider.
Don’t hesitate to contact us with news tips. Just send a message to simon@teslarati.com to give us a heads up.
Tesla has finally clarified the situation regarding the viral crash in Texas where a Model 3 slammed into a home.
CEO Elon Musk replied to reports on Monday that stated the crash was due to the company’s Full Self-Driving or Autopilot suite, which seemed unlikely to those who are familiar with it. Video showed the car slamming into a house at an excessive rate of speed, making it highly unlikely the crash was due to the suite’s operation, as it does not travel at those speeds in residential areas.
Musk said:
“This makes no sense. FSD drives slowly through neighborhood streets, and this was a high-speed crash!”
Tesla’s Head of AI, Ashok Elluswamy, added context, revealing that the company’s data shows the driver “manually overrode self-driving by pressing the accelerator all the way to 100%.”
He revealed the speed reached by the car was 73 MPH, and the accelerator was still pressed “even after the crash.”
Yup. In this case, the driver manually overrode self-driving by pressing the accelerator all the way to 100% of the accel pedal in this residential area. They reached a speed of 73 mph during the crash, and had the accelerator pressed even after the crash.
— Ashok Elluswamy (@aelluswamy) June 22, 2026
Authorities are reportedly investigating “whether Tesla’s Autopilot system played a role after a Model 3 left the roadway…slammed through a brick house at high speed and fatally struck Matha Avila as she sat inside,” the New York Post reported.
The National Highway Traffic Safety Administration (NHTSA) is now investigating the crash. Tesla will work with the agency to provide them with whatever information they need in order to clarify the cause of the crash.
Similarly, Tesla had claims of a fatal accident in Harris County, Texas, a few years ago. Early reports indicated that Full Self-Driving was the cause of the crash. After the National Transportation Safety Board (NTSB) worked with Tesla, the agency proved there was “no use of the Autopilot system at any time during this ownership period of the vehicle, including the time frame up to the last transmitted timestamp on April 17, 2021.”
Tesla alleged “driverless” crash in Texas: What is known so far
“Application of the accelerator pedal was found to be as high as 98.8 percent,” the NTSB said in their findings. The highest recorded speed in the five seconds leading up to the impact was 67 miles per hour. The area where the crash occurred is residential, and Texas State laws have default speed limits of 30 MPH in residential streets.
This appears to be a similar situation. However, an investigation will prove what happened for sure.
SpaceX announced today that it commenced its first-ever public bond offering, marking a significant step in the newly public company’s capital markets strategy.
The company announced an offering of senior unsecured notes expected to raise at least $20 billion.
The move comes just a short time after SpaceX completed one of the largest initial public offerings in history. In mid-June, the company priced shares at $135 and raised more than $85 billion, propelling founder Elon Musk’s net worth past the trillion-dollar mark and giving the firm substantial liquidity.
🚨 SpaceX has announced its inaugural offering of senior unsecured notes.
The net proceeds will be used to repay outstanding loans under its bridge loan facility in full.
This inaugural debt offering represents a financing milestone for SpaceX, which previously depended… pic.twitter.com/pcOZuVbTRv
— TESLARATI (@Teslarati) June 22, 2026
According to the company’s SEC filing, the net proceeds from the notes will be used primarily to repay in full the outstanding borrowings under its existing bridge loan facility, cover related fees and expenses, and fund general corporate purposes. The offering is being conducted under Rule 144A, as well as Regulation S, targeting qualified institutional buyers and non-U.S. investors. Notes will be unsecured obligations ranking equally with other unsubordinated debt.
The $20 billion bridge loan was used to refinance approximately $17.5 billion in higher-cost “junk” debt tied to X and xAI. SpaceX had merged with xAI in February 2026 in an all-stock deal. The bridge facility, which matures in September 2027, had represented the bulk of SpaceX’s long-term debt.
SpaceX officially acquires xAI, merging rockets with AI expertise
In connection with the bond launch, SpaceX disclosed it held approximately $100.8 billion in cash and cash equivalents as of June 19. Investor calls began on the announcement date, with pricing and launch expected shortly thereafter. Rating agencies have assigned investment-grade ratings to the proposed bonds, reflecting confidence in SpaceX’s dominant position in commercial launches and the growth trajectory of its Starlink internet offering.
The debt raise also allows SpaceX to optimize its balance sheet by replacing short-term, higher-cost bridge financing with longer-date, lower-cost fixed-income securities. This provides greater financial flexibility to support capital-intensive initiatives, including the development of Starship, the expansion of the Starlink constellation, and the integration of AI capabilities following the xAI combination.
SpaceX shares (NASDAQ: SPCX) fell sharply on the news, dropping over 16 percent overall on the market on Monday. The stock had surged initially after debuting but pulled back amid profit-taking and broader market dynamics.
Overall, the bond offering underscores SpaceX’s transition to a mature public company with access to diverse funding sources. It positions the firm to pursue its long-term vision of multiplanetary expansion and AI infrastructure, while maintaining a disciplined approach to its capital structure in a high-growth but capital-heavy industry.
SpaceX confirmed today that it has officially signed its third massive compute deal, providing compute at its Colossus data center in Southaven, Mississippi.
Reflection AI will gain immediate access to NVIDIA GB300 chips at SpaceX’s Colossus 2 data center. In return, Reflection will pay SpaceX $150 million per month starting on July 1, with total payments reaching approximately $6.3 billion if the contract runs through its duration, which is until 2029. Either party can terminate the agreement with 90 days’ notice after the initial three-month period.
CNBC first reported the deal.
🚨 SpaceXAI has agreed to a new compute deal with Reflection AI.
Reflection gets access to NIVIDIA GB300s, and will pay $150M per month to SpaceXAI for the compute. pic.twitter.com/bNPare8U5u
— TESLARATI (@Teslarati) June 22, 2026
This latest partnership highlights SpaceX’s strategy of commercializing its massive Colossus supercomputing infrastructure, originally developed to power Elon Musk’s Grok AI models. The company has rapidly expanded its customer base in the AI sector following its February 2026 merger with xAI, a transaction that valued the combined entity at $1.25 trillion.
SpaceX has previously signed significant compute deals with other major players.
It granted Anthropic exclusive access to the full capacity of its Colossus 1 data center, which exceeds 300 megawatts and includes over 220,000 NVIDIA GPUs. Details from SpaceX’s IPO filings indicate Anthropic will pay $1.25 billion per month through May 2029, potentially generating around $45 billion over the term of the deal.
Additionally, Google agreed to pay SpaceX $920 million per month for compute capacity from October 2026 through June 2029. This 32-month period will provide Google access to roughly 110,000 NVIDIA GPUs, along with supporting processors and memory. Capacity ramps up through September at a reduced fee, with termination options after the first year.
SpaceXA also established arrangements for computing power with Cursor, an AI coding startup. SpaceX acquired them in a $60 billion all-stock deal.
These arrangements position SpaceX’s collective position as an AI infrastructure powerhouse with high-margin revenue potential. The Google deal alone could generate nearly $29.5 billion over its term, while the Reflection contract adds another $6.3 billion.
Combined with the Anthropic arrangement, SpaceX stands to realize tens of billions in revenue from compute leasing in the coming years, which diversifies beyond SpaceX’s traditional rocket launches and Starlink operation.
The deals underscore growing demand for advanced AI training and inference capacity amid chip shortages and surging model development needs. Reflection, valued at $25 billion and focused on “American open intelligence” with government and national security ties, cited recent restrictions on closed models as validation for open-source approaches.
For SpaceX, the partnerships transform capital-intensive data centers into flexible revenue sources while supporting its broader AI ambitions after the company has gone public.
Tesla finally clarifies fatal Texas crash, confirms driver manually overrode acceleration
SpaceX makes $20 billion move to optimize its balance sheet
