Tesla and CEO Elon Musk have officially published the company's highly anticipated Master Plan Part 3, and it's ridiculously optimistic as are nearly all of Musk's plans. According to a preliminary analysis by Benchmark, Tesla and Musk may have fallen short when estimating the true scale of the plan's investment.
Benchmark's chief executive Simon Moores shared:
"Let’s not make the same error we made with gigafactories, with all the money for them and none for mining. The industry needs joined up thinking."
If Tesla's Master Plan Part 3 wasn't overly optimistic and nearly out of reach, it arguably wouldn't be a plan put together for Tesla by Elon Musk. Nearly all of Musk's plans are seen as overly optimistic or even impossible. Most often, the plans don't come together in a timely manner, and they often change significantly from the original proposal. However, Tesla and Musk have been known to come through in the end, at least in many cases.
Musk was told he'd never land and reuse rockets at SpaceX. For years, it seemed Tesla was on the verge of bankruptcy and electric car adoption would never really take hold. When the vocal CEO started a company to dig holes underneath major cities, people laughed at him.
There was also a time when he decided Tesla would open a huge electric car factory in China in record time, though some media experts said it would never move beyond a muddy field, and there would never be the demand to sustain a second EV plant. Now, Tesla has four EV factories and it's about to build a fifth.
With all of that said, we do know that Musk has crazy ideas, and some simply won't work as planned. Adjustments may need to be made, and timelines extended, perhaps time and time again. After poring over the latest Master Plan, Benchmark notes that Tesla's estimated costs associated with the plan are likely too low. Setting aside the $7 trillion Tesla estimates it will cost for battery production leaves $3.4 trillion for everything else related to the plan.
Tesla's goal is to reach 240 TWh of total battery deployment, which will require mining, refining, chemicals, and the necessary Gigafactories and recycling. Tesla outlines the total for all of this at $3.4 trillion. It plans to make large investments of $374 billion in lithium mining and refining, in addition to $282 billion in graphite.
The total estimate provided by Tesla for all related Gigafactories and recycling is just over $2 trillion, with the other $1.4 trillion going toward mining, refining, and chemicals. While Benchmark estimates that Tesla may be on point with the Gigafactories and recycling costs, the firm estimates that mining, refining, and chemicals will cost a minimum of $2.5 trillion, though it could set Tesla back as much as $3 trillion.
