Tesla CEO Elon Musk explained the carmaker’s strategy to build batteries from top to bottom in a domestic framework as the company continues to relieve its dependence on Chinese materials, something other companies are too dependent on.
With the Trump administration, it is no secret that the prioritization of US-built products, including sourcing of most of the materials from US companies, is at the forefront of its strategy.
The goal is to become less dependent on foreign products, which in theory would strengthen the US economy by creating more jobs and having less dependence on foreign markets, especially China, to produce the most important parts of things like cars and tech.
In a note from Alexander Potter, an analyst for the company Piper Sandler, Tesla’s batteries strategy are specifically divided.
Potter says Tesla is “the only car company trying to buy batteries, on scale, without trusting China.”
He continues:
“Finally, Tesla will produce its own cathode active materials, refine its own lithium, build its own anodes, coat his own electrodes, collect its own cells and sell its own cars; no other American companies can make similar claims.”
Musk, who spent time in Trump The White House through his work with the Department of Government Efficiency (DOGE), said Tesla performs the “important” work of locating supply chains, as the risks that come with being too dependent on foreign units could be detrimental to a company, especially one that uses many parts and supplies that are made most in China.
It is important, although extremely hard work, to locate supply chains to mitigate geopolitical risk
– Elon Musk (@elonmusk) June 3, 2025
Tesla has done a lot of work to buy and even manufacture its own batteries in the US, a project that has been running for several years but will pay dividends in the end.
According to a 2023 Nikkei Analysis, Tesla’s battery material suppliers were dominated by Chinese companies. At that time, as many as 39 percent of the company’s cell materials came from Chinese companies.
This number falls as it drives its own internal cell and material production projects, such as its lithium refinery in Texas.
It also wants to use battery manufacturers who are planning to build cells in the US
For example, Panasonic is building a facility in Kansas that will help Tesla use domestic -made cells for its cars.