- Elon Musk seems to be courting Argentine President Javier Milei to secure lithium supplies.
- Argentina has the world's second-largest lithium reserves, which are crucial for EV batteries.
Tesla CEO Elon Musk has been cozying up to Argentine president Javier Milei — and lithium may be one reason why.
Argentina has the world's second-biggest reserves of the metal used in batteries for electric cars.
Milei told the TV show "La Noche De Mirtha" in December that Musk had called him and said he was "extremely interested" in lithium.
Musk plans for Tesla to build cheaper cars. The company said last month it will launch "new and more affordable products" earlier than expected, after previously mooting the second half of 2025.
But those ambitions partly rely on Tesla getting enough lithium supply for its EV batteries at a decent price.
Lithium supply security has become a major priority for firms like Tesla. Lithium production outside the US rose by 23% in 2023 from the previous year due to strong demand from the battery market, according to data from the United States Geological Survey.
Tesla broke ground on a Texas lithium refinery last May, which it said would open this year, Reuters reported at the time. Musk said at the ceremony: "As we look ahead a few years, a fundamental choke point in the advancement of electric vehicles is the availability of battery-grade lithium."
Musk's courting of Milei could suggest he thinks getting lithium from Argentina is an answer to that problem.
He met the Argentine leader for the first time last month at Tesla's factory in Austin. Argentina's ambassador to the US, Gerardo Wethein, told Argentine media that the pair talked about Tesla's "investment opportunities" in lithium, the Financial Times reported.
Musk met up with Milei again last week, shared a photo of them on X, and later told his followers: "I recommend investing in Argentina."
The far-right Milei won last November's presidential election in a victory welcomed by the likes of Donald Trump. He's vowed to fix Argentina's battered economy, where inflation is running at about 300%, but austerity measures have triggered widespread strikes.
Tesla didn't immediately respond to a request for comment from Business Insider.