“If you want it done right, do it yourself.” That was the lesson Henry Ford, the affordable car tycoon of the past century, taught a generation of aspiring business people — to take control of their own destiny. One of them happened to be Elon Musk, who has most certainly adopted the mantra.
This week he announced his electric car company Tesla is (likely) to acquire the solar panel company SolarCity, of which he is also a board member (Musk is quite “entangled” as Quartz observes). The move is just another in a long line of examples that show how Musk is emulating Henry Ford’s strategies for success.
Ford famously took the reins of his own production by going as far as to start an iron ore mine to directly source the materials for his cars. Musk has done the same with his all electric vehicles by building his gigafactory to produce batteries in-house. However, to make those batteries, he needs lithium and a lot of it. The supply for lithium is low and the demand is high because it’s used in nearly all electronics today including smartphones, laptops, and new electric cars.
Musk hasn’t gone as far as Ford to upright buy a lithium mine, but he did build the gigafactory a mere three and a half hour drive away from Clayton Valley, the only operating lithium mine in the United States. The owners of the mine are outside of the typical lithium oligarchy that controls the global market and may allow Musk to cheaply obtain the valuable metal.
And think: Tesla owners could one day buy solar panels for their home charging station or Musk could put the panels directly on the car, much like Toyota is doing this year with the announcement of the Prius Prime.
But batteries won’t be able to recharge from the sun if Musk can’t secure lithium. During a May shareholders meeting, he assured investors that lithium only accounts for 2 percent of the metals in Tesla batteries, but Bloomberg reports that doesn’t make Musk exempt from the pressures of global supply and demand. China, Japan, and Korea account for more than 85 percent of current lithium ion battery output, according to researcher CRU Group, and China has big plans — 5 million EV’s by 2020 — for an electric car future.
Musk may have to do as Henry Ford once did and buy the lithium mine itself. For now, he’s scouring the world for suppliers.