Tesla breaks ground on lithium refinery that will supply Austin facility

Austin-based Tesla broke ground on a new $375 million lithium refinery in rural Neuces County near Corpus Christi on Monday, adding to its growing Texas business ecosystem.

The new facility is anticipated to play a key role in Austin-based Tesla's southeastern Travis County manufacturing facility, which is expected to produce batteries in addition to electric vehicles. Once fully operational, the Corpus Christi-area refinery would provide Tesla with enough lithium for about a million vehicle batteries produced in Austin and elsewhere, CEO Elon Musk said Monday.

The facility, which is in Robstown, is expected to be the first of its kind in the United States, and one of the biggest in the world. The refinery will package and ship lithium hydroxide, a key component in electric vehicle batteries.

The refinery is expected to have 250 temporary jobs during construction of the facility, and 162 permanent jobs once the facility is operational, according to a tax abatement application Tesla submitted to the Robstown Independent School District last year.

Musk said the facility, which would start construction immediately, is expected to be completed in 2024 and increase to full production levels about a year later.

The Caller-Times reported last year that Tesla approached both Robstown ISD and Nueces County seeking tax abatements for the plant. The company was granted a tax break was granted under Texas's now-expired Chapter 313 program, but Tesla later rescinded the application for reasons that were not clear, according to the Caller-Times.

Texas Gov. Greg Abbott attended the groundbreaking on Monday, and praised Tesla and Musk's investments in the Lone Star State in recent years, including the carmaker's $1.1 billion manufacturing facility in Travis County, and its headquarters relocation to the same site in late 2021.

More: Did Tesla pick a Texas site for its $375M battery refinery? What we know

Part of Tesla's global growth:

The Corpus facility is one of several new facilities Tesla has announced this year, including a battery facility in Shanghai, and a new car plant in Mexico. The additions come as the Austin-based electric carmaker continues to build out its headquarters and manufacturing plant in Central Texas with no signs of slowing down.

This includes a cathode facility the company has been building out in Austin at Giga Texas, its southeastern Travis County manufacturing facility. Cathodes are a key part in vehicle batteries.

Last year, Tesla delivered its first Austin-made Model Y SUVs during the grand opening of its southeastern Travis County facility. The facility is also expected to roll out the long anticipated Cybertruck later this year, and to also eventually produce Model 3’s.

'Regionalizing the supply chain'

Turner Caldwell, a Tesla manager focused on batteries manufacturing and raw material processing, said during the groundbreaking the company views the site as a major focus on regionalizing the lithium supply chain.

“It's all about being flexible and taking advantage of all of those feeds including manufacturing, scrap and end of life batteries,” Caldwell said.

The Corpus Christi location is ideal in part because of its proximity to Austin and access to a deepwater port and rail, said Drew Baglino, a Tesla executive.

Neither Musk nor Abbott took questions following the ceremony, according to the Caller Times.

The groundbreaking came the same day as a group senators sent a letter to Tesla, and CEO Elon Musk, urging the company to end forced arbitration for workers and customers. The group of senators included Sens. Richard Blumenthal, D-Conn. Sherrod Brown, D-Ohio. Dick Durbin, D-I11, Ed Markey, D-Mass., Jeff Merkley, D-Ore., Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass.

Like other large companies, the Austin-based company requires workers to sign an arbitration agreement upon employment that requires workers to get an exception from a judge in order to speak freely in court about the company. The letter referenced discrimination lawsuits filed by black workers that alleged regular racial discrimination, as well as women who alleged objectification and harassment. It also said that Tesla has forced arbitration clauses in customer contracts, which the letter said has obscured details about safety and business practices.

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This article originally appeared on Austin American-Statesman: Austin-based Tesla breaks ground on Corpus Christi lithium refinery