Saturday, 10 June 2023

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Elon Musk: Entrepreneurs missing opportunities in heavy industry

Elon Musk: Entrepreneurs missing opportunities in heavy industry

Tesla CEO Elon Musk isn’t against entrepreneurs creating apps for smartphones, but he wishes more of them would focus on heavy industry—where he says the opportunities are “tremendous.”

The Tesla CEO made the comments while speaking with Ford CEO Jim Farley in a Twitter Spaces event on Thursday evening. The two announced that Tesla supercharger stations will become available to owners of Ford electric vehicles (to the chagrin of Tesla customers already dealing with long wait times).

At one point in the conversation, Farley asked Musk about his experience in processing raw materials near Corpus Christi, Texas, where Tesla earlier this month broke ground on a lithium refinery. 

Lithium hydroxide, which the facility will package and ship, is a core component in electric vehicle batteries, but it’s in short domestic supply. Musk said on Thursday that there’s plenty of lithium globally, but that Tesla identified a “significant choke point” in the processing of it. It’s something that Tesla would rather not do itself, he added, but is compelled to.

“Our actual goal is to do the least amount possible, but then we end up hitting these choke points—or we anticipate hitting choke points,” he said. “So a lot of the vertical integration is really out of necessity.” 

Musk said Tesla would gladly use suppliers instead if they were “solving the problem” and if they could clearly continue to meet the production needs of the carmaker, which could then redirect resources elsewhere.

Tesla has also been building a facility at its Texas gigafactory for producing cathodes, another key part of EV batteries.

‘Over-allocation of talent’

Musk said he wishes more entrepreneurs would get involved in heavy industry. 

“I see so many entrepreneurs in Silicon Valley doing a software startup or sort of chasing the latest greatest thing. But not enough of the talent in North America goes into heavy industry,” he said “And the crazy thing is the opportunity in heavy industry is tremendous. So I’d just really like to encourage entrepreneurs to think about things that don’t involve, you know, that end up on a phone, basically.” 

He added, “Apps on the phone, we need them, but like, you know, I just think we have an over-allocation of talent towards apps on phones.” 

Venture capitalist Paul Graham, cofounder of the startup accelerator Y Combinator, commented on the “preponderance of software…

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