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Tesla supplier sheds light on graphite supply challenge for EV battery manufacturers [Editorial]
Graphite is an essential part of a lithium-ion battery. There are many challenges that EV battery manufacturers might face in the graphite market as electric vehicle demand continues to rise.
Graphite is often an overlooked essential mineral when people think of EV batteries. However, it is a crucial component in the anodes of lithium-ion batteries used in electric vehicles.
Graphite and Transparency
The chief executive of Syrah Resources, Shaun Verner, shared a bit about graphite pricing and funding for new projects. Syrah Resources is an Australian company that supplies Tesla from its mine in Mozambique, one of the largest graphite producers.
Verner commented that the graphite market lacks transparency when it comes to pricing, leading bankers to hesitate when it comes to funding new graphite-related projects.
Only a handful of countries mine graphite and even fewer refine the mineral enough to be used in batteries and other products. With few producers in the graphite industry, graphite consumers enter into long-term bilateral supply agreements with little transparency on prices. In addition, relatively few analysts follow the graphite industry, making it difficult to get any long-term forecasts on graphite prices.
-->“The single biggest impediment to new investment is the opaque nature of the market because to get the commercial debt in place is really challenging,” said Verner.
Graphite Supply
Graphite prices have declined in recent months compared to the highs in early 2022. Fastmarkets reported that traditional graphite applications have decreased this year, resulting in “sluggish” conditions in the market. However, graphite demand is expected to rise in the next few years due to growth in the electric vehicle sector.
“Graphite has kind of been the poor cousin of the battery minerals and doesn’t get the attention of the other commodities,” commented Gregory Bowes, executive chairman of the Northern Graphite Corporation. “But we’re getting very close to an inflection point where demand overtakes supply and this is going to be first page news.”
Experts observing the graphite market expect graphite supply to hit a deficit as EV battery makers increase production. Fastmarkets estimates that natural graphite consumption would rise 40% year on year, on par with the EV sector. Benchmark Mineral Intelligence had the same forecast and calculated that graphite supply would hit a deficit of 20,000 tons in 2022.
China’s dominance in the graphite industry factors into the forecasted deficit since it dominates the graphite market. In 2021, China produced 820,000 metric tons (MT) of graphite, a significant increase compared to the previous two years. The US Geological Survey reported that China accounted for 79% of the world’s graphite mining last year. The country’s quick recovery from COVID-19 shutdowns contributed to its dominance in 2021.
“Chinese producers quickly increased production after a few months of closures in 2020. This allowed China to gain a more dominant position in the market for 2021 and slowed down the diversification of the supply chain,” noted the US Geological Survey’s report.
-->After China, Brazil and Mozambique are the next largest graphite producers. Brazil produced 68,000 MT last year, while Mozambique’s output was 30,000 MT. Russia, Madagascar, Ukraine, Norway, Canada, India, and Sri Lanka make up the remaining Top 10 countries that produce graphite.
Graphite and the Inflation Reduction Act
The graphite industry might be a major challenge for automakers seeking to launch their products in the United States over the next few years. The recently passed Inflation Reduction Act included EV tax credits that could go as high as $7,500 for automakers that adhere to a few specific requirements.
One of the requirements to qualify for the EV tax credit is related to batteries and the minerals used to make them. According to the Inflation Reduction Act, at least 40% of the critical minerals used to make US-made EV batteries must also come from US miners or recycling plants. Automakers can also qualify for the tax credit if the minerals used in their US-made batteries come from countries with free trade deals with the United States.
In 2021, natural graphite was not produced in the United States, but it consumed 45,000 tons of the mineral, estimated to be worth $41 million. The United States imported about 53,000 tons of graphite last year, mainly from China. It also imported graphite from Mexico, Canada, India, and other sources.
US Geological Survey mentioned one US automaker in its report about graphite imports. It did not mention the automaker by name.
-->“A US automaker continued building a large plant to manufacture lithium-ion electric vehicle batteries. The completed portion of the plant was operational, and it produced battery cells, battery packs, drive units, and energy storage products. At full capacity, the plant was expected to require 35,200 tons per year of spherical graphite for use as anode material for lithium-ion batteries,” stated the report.
Eric Desaulniers, the chief executive of Nouveau Monde Graphite, stated that discussions with cell manufacturers have ramped up after the Inflation Reduction Act was passed. Nouveau Monde is currently developing a graphite mine and battery-grade anode plant in Canada.
Desaulniers noted that challenges are ahead when it comes to securing project financing since “cell makers are cash-constrained.” He also noted that automakers had their hands full from scaling up their respective battery manufacturing facilities.
Tesla, considered the lead electric vehicle manufacturer in the United States, is already producing its 4680 battery cells in California. Rivian, General Motors, and other automakers also plan to develop their own battery cells in their own battery manufacturing plants.
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Elon Musk said in late November that he’s “tried to warn” legacy automakers and “even offered to license Tesla Full Self-Driving, but they don’t want it,” expressing frustration with companies that refuse to adopt the company’s suite, which will eventually be autonomous.
Tesla has long established itself as the leader in self-driving technology, especially in the United States. Although there are formidable competitors, Tesla’s FSD suite is the most robust and is not limited to certain areas or roadways. It operates anywhere and everywhere.
The company’s current position as the leader in self-driving tech is being ignored by legacy automakers, a parallel to what Tesla’s position was with EV development over a decade ago, which was also ignored by competitors.
The reluctance mirrors how legacy automakers initially dismissed EVs, only to scramble in catch-up mode years later–a pattern that highlights their historical underestimation of disruptive innovations from Tesla.
Elon Musk’s Self-Driving Licensing Attempts
Musk and Tesla have tried to push Full Self-Driving to other car companies, with no true suitors, despite ongoing conversations for years. Tesla’s FSD is aiming to become more robust through comprehensive data collection and a larger fleet, something the company has tried to establish through a subscription program, free trials, and other strategies.
Tesla CEO Elon Musk sends rivals dire warning about Full Self-Driving
However, competing companies have not wanted to license FSD for a handful of speculative reasons: competitive pride, regulatory concerns, high costs, or preference for in-house development.
Déjà vu All Over Again
Tesla tried to portray the importance of EVs long ago, as in the 2010s, executives from companies like Ford and GM downplayed the importance of sustainable powertrains as niche or unprofitable.
Musk once said in a 2014 interview that rivals woke up to electric powertrains when the Model S started to disrupt things and gained some market share. Things got really serious upon the launch of the Model 3 in 2017, as a mass-market vehicle was what Tesla was missing from its lineup.
This caused legacy companies to truly wake up; they were losing market share to Tesla’s new and exciting tech that offered less maintenance, a fresh take on passenger auto, and other advantages. They were late to the party, and although they have all launched vehicles of their own, they still lag in two major areas: sales and infrastructure, leaning on Tesla for the latter.
I’ve tried to warn them and even offered to license Tesla FSD, but they don’t want it! Crazy …
When legacy auto does occasionally reach out, they tepidly discuss implementing FSD for a tiny program in 5 years with unworkable requirements for Tesla, so pointless. 🤷♂️
🦕 🦕
— Elon Musk (@elonmusk) November 24, 2025
Musk’s past warnings have been plentiful. In 2017, he responded to critics who stated Tesla was chasing subsidies. He responded, “Few people know that we started Tesla when GM forcibly recalled all electric cars from customers in 2003 and then crushed them in a junkyard,” adding that “they would be doing nothing” on EVs without Tesla’s efforts.
Companies laughed off Tesla’s prowess with EVs, only to realize they had made a grave mistake later on.
It looks to be happening once again.
A Pattern of Underestimation
Both EVs and self-driving tech represent major paradigm shifts that legacy players view as threats to their established business models; it’s hard to change. However, these early push-aways from new tech only result in reactive strategies later on, usually resulting in what pains they are facing now.
Ford is scaling back its EV efforts, and GM’s projects are hurting. Although they both have in-house self-driving projects, they are falling well behind the progress of Tesla and even other competitors.
It is getting to a point where short-term risk will become a long-term setback, and they may have to rely on a company to pull them out of a tough situation later on, just as it did with Tesla and EV charging infrastructure.
Tesla has continued to innovate, while legacy automakers have lagged behind, and it has cost them dearly.
Implications and Future Outlook
Moving forward, Tesla’s progress will continue to accelerate, while a dismissive attitude by other companies will continue to penalize them, especially as time goes on. Falling further behind in self-driving could eventually lead to market share erosion, as autonomy could be a crucial part of vehicle marketing within the next few years.
Eventually, companies could be forced into joint partnerships as economic pressures mount. Some companies did this with EVs, but it has not resulted in very much.
Self-driving efforts are not only a strength for companies themselves, but they also contribute to other things, like affordability and safety.
Tesla has exhibited data that specifically shows its self-driving tech is safer than human drivers, most recently by a considerable margin. This would help with eliminating accidents and making roads safer.
Tesla’s new Safety Report shows Autopilot is nine times safer than humans
Additionally, competition in the market is a good thing, as it drives costs down and helps innovation continue on an upward trend.
Conclusion
The parallels are unmistakable: a decade ago, legacy automakers laughed off electric vehicles as toys for tree-huggers, crushed their own EV programs, and bet everything on the internal-combustion status quo–only to watch Tesla redefine the industry while they scrambled for billions in catch-up capital.
Today, the same companies are turning down repeated offers to license Tesla’s Full Self-Driving technology, insisting they can build better autonomy in-house, even as their own programs stumble through recalls, layoffs, and missed milestones. History is not merely rhyming; it is repeating almost note-for-note.
Elon Musk has spent twenty years warning that the auto industry’s bureaucratic inertia and short-term thinking will leave it stranded on the wrong side of technological revolutions. The question is no longer whether Tesla is ahead–it is whether the giants of Detroit, Stuttgart, and Toyota will finally listen before the next wave leaves them watching another leader pull away in the rear-view mirror.
This time, the stakes are not just market share; they are the very definition of what a car will be in the decades ahead.
News
Waymo driverless taxi drives directly into active LAPD standoff
No injuries occurred, and the passengers inside the vehicle were safely transported to their destination, as per a Waymo representative.
A video posted on social media has shown an occupied Waymo driverless taxi driving directly into the middle of an active LAPD standoff in downtown Los Angeles.
As could be seen in the short video, which was initially posted on Instagram by user Alex Choi, a Waymo driverless taxi drove directly into the middle of an active LAPD standoff in downtown Los Angeles.
The driverless taxi made an unprotected left turn despite what appeared to be a red light, briefly entering a police perimeter. At the time, officers seemed to be giving commands to a prone suspect on the ground, who looked quite surprised at the sudden presence of the driverless vehicle.
People on the sidewalk, including the person who was filming the video, could be heard chuckling at the Waymo’s strange behavior.
The Waymo reportedly cleared the area within seconds. No injuries occurred, and the passengers inside the vehicle were safely transported to their destination, as per a Waymo representative. Still, the video spread across social media, with numerous netizens poking fun at the gaffe.
-->Others also pointed out that such a gaffe would have resulted in widespread controversy had the vehicle involved been a Tesla on FSD. Tesla is constantly under scrutiny, with TSLA shorts and similar groups actively trying to put down the company’s FSD program.
A Tesla on FSD or Robotaxi accidentally driving into an active police standoff would likely cause lawsuits, nonstop media coverage, and calls for a worldwide ban, at the least.
This was one of the reasons why even minor traffic infractions committed by the company’s Robotaxis during their initial rollout in Austin received nationwide media attention. This particular Waymo incident, however, will likely not receive as much coverage.
Tesla Model Y demand in China is through the roof, and new delivery dates show the company has already sold out its allocation of the all-electric crossover for 2025.
The Model Y has been the most popular vehicle in the world in both of the last two years, outpacing incredibly popular vehicles like the Toyota RAV 4. In China, the EV market is substantially more saturated, with more competitors than in any other market.
However, Tesla has been kind to the Chinese market, as it has launched trim levels for the Model Y in the country that are not available anywhere else. Demand has been strong for the Model Y in China; it ranks in the top 5 of all EVs in the country, trailing the BYD Seagull, Wuling Hongguang Mini EV, and the Geely Galaxy Xingyuan.
The other three models ahead of the Model Y are priced substantially lower.
Tesla is still dealing with strong demand for the Model Y, and the company is now pushing delivery dates to early 2026, meaning the vehicle is sold out for the year:
NEWS: New orders for all four Tesla Model Y trims in China are now officially sold out for 2025, as the factory’s remaining production capacity for the year has been fully allocated.
Estimated delivery dates for new orders now show January-February 2026. pic.twitter.com/Dfnu7yY58N
— Sawyer Merritt (@SawyerMerritt) December 1, 2025
Tesla experienced a 9.9 percent year-over-year rise in its China-made EV sales for November, meaning there is some serious potential for the automaker moving into next year despite increased competition.
There have been a lot of questions surrounding how Tesla would perform globally with more competition, but it seems to have a good grasp of various markets because of its vehicles, its charging infrastructure, and its Full Self-Driving (FSD) suite, which has been expanding to more countries as of late.
Tesla Model Y is still China’s best-selling premium EV through October
Tesla holds a dominating lead in the United States with EV registrations, and performs incredibly well in several European countries.
With demand in China looking strong, it will be interesting to see how the company ends the year in terms of global deliveries.
Elon Musk and Tesla try to save legacy automakers from Déjà vu
Waymo driverless taxi drives directly into active LAPD standoff
