Elon Musk relieved that lithium prices are no longer ‘insane’

The reduction in commodity prices translates into thousands of dollars on a per-vehicle basis, Karn Budhiraj, vice-president for supply chain at Tesla, said on the call. To lock in the lower costs, the company is extending some fixed-price contracts with suppliers through the end of this decade, he said.

Still, Tesla reported smaller profits in the second quarter, which were mostly in line with Wall Street forecasts, and said it will probably keep slashing prices of its EVs if interest rates keep rising.

Tesla said it had broken ground on its own lithium refinery in Texas earlier this year. Progress on the plant, as well as a cathode facility, were going well, Musk said on the call.