Panasonic, Tesla’s exclusive battery cell suppliers for its vehicles, has shut down its relationship with a cobalt supplier due to a possible violation of the US embargo with Cuba.

Cobalt is currently a critical mineral for the most popular li-ion chemistries in batteries for electric vehicles.

Tesla and Panasonic have recently reduced the amount of cobalt used in their batteries.

The automaker wrote in its recent ‘Conflict Minerals Report’:

It is important to note that there is very little cobalt in Tesla’s battery cells. On a relative basis, cobalt simply is not that significant to the composition of Tesla’s battery cells, as we mainly use NCA batteries, which contain substantially less cobalt than NMC batteries. Cells used in Model 3 production are the highest energy density cells used in any electric vehicle. We have achieved this by significantly reducing cobalt content per battery pack while increasing nickel content and still maintaining superior thermal stability. The cobalt content of our Nickel-Cobalt-Aluminum cathode chemistry is already lower than next-generation cathodes that will be made by other cell producers with a Nickel-Manganese-Cobalt ratio of 8:1:1.

But for now, they are still using a few kilograms of cobalt in their vehicles.

Now Reuters reports that sources from Canadian supplier Sherritt International Corp was supplying cobalt to Panasonic, which in turn was using the mineral in batteries that it was shipping to Tesla in the US.

The publication suggested that it could violate the trade embargo with Cuba so Panasonic said it suspended its relationship with the company:

“Panasonic has chosen to suspend its relationship with its Canadian supplier,” a spokeswoman said, without naming the supplier. She added that Panasonic had used cobalt from the Canadian supplier for batteries used in the Tesla Model S and Model X, but only after February this year.”

The Japanese electronics giant says that it “has sought guidance from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC)” over the issue.

It’s not clear how it will impact Panasonic’s battery production in the meantime, but it’s one of many suppliers for the company.

Update: A Tesla

“Tesla is aiming to achieve close to zero usage of cobalt in the near future.”

The automaker says that it won’t impact production.

Electrek’s Take

I’m no international trade expert, but it sounds stupid to me. Nevermind that the US has been applying trade embargo for over 50 years on Cuba.

Now Reuters is making an issue out of it because the resource is going through Canada, then Japan, before making its way back to the US.

The bigger question is how are the working conditions for mining cobalt in Cuba. That’s the biggest problem with cobalt, especially when a lot of it comes from the Republic of Congo.

If the conditions are better, why would we discourage getting cobalt from those mines?

Fidel is dead. It has been over 50 years since the Bay of Pigs. Might it be time to move on?

What do you think? Let us know in the comment section below.

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