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Let the Lithium Era Begin

The REAL Winner Isn't Tesla

Written by Keith Kohl
Posted July 27, 2016

Mobileye just made a huge mistake.

For those of you who haven't heard of this nearly $10 billion company, it's a go-to for anyone looking to build semi-autonomous cars.

And at first glance, it's hard not to see more growth ahead. The company recently announced an earnings beat to the tune of $0.02 per share higher than analyst expectations. Revenues are up 58% year-over-year, making a fool of those same analysts.

And yet shares plummeted as much as 14% yesterday morning, all on a single piece of news:

Mobileye will no longer be working with Tesla.

You see, so far Mobileye was best known for supplying Tesla with the chips that help power the autonomous sensors and cameras on the Model S cars.

But after the death of a Model S driver in Florida just a few weeks ago, it turns out that Mobileye doesn't think Tesla is the best company to be using its technology, so it'll take its business to more traditional car companies.

Not only was Tesla unfazed by the decision, but shares continued to climb higher.

Something tells me Elon Musk will survive...

Keep Calm, Tesla On

It should be clear by now that Tesla has recovered from the sell-off that took place after announcing its plans to buy SolarCity.

Point is, people haven't abandoned Tesla... and it's no wonder why.

Love him or hate him, you can't help but agree that Elon Musk is notorious for getting things done.

He started (and sold) PayPal after teaching himself how to code!

Of course, then there's SpaceX, which has made several missions to the International Space Station and back. Someone wouldn't sell Musk a rocket — so he decided to build his own.

Once upon a time, he even saved Tesla from the brink of bankruptcy. It never would've survived the crash in 2008 had Musk not stepped in.

Things are about to get much more interesting... very soon.

And it all starts in less than 48 hours.

Let the Lithium Age Begin

Mobileye may have moved on due to its principled stance on ensuring a high level of safety, but it couldn't have picked a worse moment to do it.

It was over a year ago that we talked about Musk's dreams of building his Gigafactory in the Nevada desert.

That was a $5 billion dream, mind you.

Well, the wait is over... almost.

We only have to hold out another two days for Tesla's official grand opening of its Gigafactory.

And considering the feverish pace its employees are working right now, you can call it a race to the finish line.

Elon even doubled his workforce to make sure his deadlines are met.

Keep in mind, however, that this is just the beginning, too. The $5 billion facility is actually only a fraction of the size it will be when all is said and done.

Once Tesla has a fully armed and operational Gigafactory, it will be churning out enough battery cells to power more than a million and a half cars every year.

And yet most people still haven't caught on to the real winners in Nevada.

The REAL Winner Isn't Tesla

Ever notice that Elon Musk's fingernails keep getting shorter every time he gives an interview?

Take a look next time. It wouldn't surprise me to learn that he nervously gnaws them down behind closed doors.

But what could possibly have HIM, of all people, worried about the future?

It's not those Gigafactory deadlines. After all, he can always hire more and more workers to accomplish those goals on time.

No, what has him panicking is one simple question that must be on his mind constantly: where will he get the lithium he needs?

Remember, 70% of global lithium reserves are located in the “Lithium Triangle” in Argentina, Chile, and Bolivia.

Trust me, it gets worse for Elon.

I've called the lithium triangle a racket in the past, comparing it with the likes of OPEC.

Truth is, OPEC doesn't even come close to this level of control. Just three companies account for 90% of the world's lithium supply.

Considering the vast amount of lithium that the Gigafactory (as well as future Gigafactories) will require each year, I'm shocked Elon Musk still has fingernails to bite.

Thing is, we KNOW Musk is hiding an ace up his sleeve.

And it wasn't coincidence that he chose the location of his first Gigafactory to be built in the Nevada desert.

It wasn't a decision made lightly.

If we've learned anything watching Musk build his empire, it's to never underestimate him. He's been clear from the start where he's going to get his lithium.

You just have to beat him to it.

And I'll show you how... right here.

Until next time,

Keith Kohl Signature

Keith Kohl

follow basic@KeithKohl1 on Twitter

A true insider in the energy markets, Keith is one of few financial reporters to have visited the Alberta oil sands. His research has helped thousands of investors capitalize from the rapidly changing face of energy. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital as well as Investment Director of Angel Publishing's Energy Investor. For years, Keith has been providing in-depth coverage of the Bakken, the Haynesville Shale, and the Marcellus natural gas formations — all ahead of the mainstream media. For more on Keith, go to his editor's page.

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