Elon Musk is pushing the vehicle manufacture industry to seek out more high purity manganese to power its vehicles.

As the world transitions to electric vehicle (EV) dominance, manganese will play a key role in EV production.

At the Tesla’s Battery Day 2020, held today, Musk said Tesla’s next generation EV batteries will contain 1/3 manganese.

“It’s relatively straight forward to do a cathode that’s 2/3 Nickel 1/3 Manganese, which will allow us to make 50% more cell volume with the same amount of Nickel,” Musk said.

A well located, ASX company could be one of the beneficiaries.

Euro Manganese Inc (ASX: EMN) is sitting on the largest manganese resource in Europe, right in the thick of the action when it comes to battery markets in Europe, where there is no local manganese supply.

EMN has the largest manganese resource in Europe and will recycle waste to produce highly refined manganese metal and salts (no “mining” involved).

Furthermore, it is strategically located in the Czech Republic with 6+ large battery factories located just 200 to 500kms away.

Tesla will need to source its manganese from a local supplier to keep costs manageable.

Telsa’s under construction Gigafactory in Germany will be the most advanced high-volume electric vehicle production plant in the world and the company plans to produce 500,000 electric vehicles at the Grünheide site starting from the European summer of 2021.

Europe is at the heart of the EV revolution and Tesla’s announcement today could prove to have a snowball effect on European manufacturers who are likely to follow in the US company’s footsteps in seeking out a high-grade manganese product and localising cathode production.

Automakers like Volkswagen, General Motors, and Ford are already pouring billions of dollars into EV development and making a huge investment in this space as they fight over the growing consumer market.

According to the European Automobile Manufacturers Association, the share of chargeable cars rose to 7.2% percent in the April-June quarter from 6.8% in the first quarter of 2020.

The changing landscape in Europe, coincides with a scaling down of subsidies in China. Sales of EVs in Europe are projected to exceed one million units in 2020 and to grow rapidly in the years to come.

It comes as the EU prepares to ‘recharge’ its climate action plan and increase its climate targets to achieve a 55% reduction in greenhouse gas emissions by 2030, a move welcomed by clean transport group Transport & Environment (T&E).

EMN well placed

EMN intends to produce battery grade manganese by reprocessing tailings in the Czech Republic.

The following map illustrates the proliferation of battery plants and the extensive network of automotive and battery manufacturers in mainland Europe and the location of EMN’s Chvaletice Manganese Project (CMP) in the Czech Republic – relative to the major European EV and battery manufacturing hub.

The company will be waste recycling from historic mines and delivering high purity manganese to EU battery makers.

EMN plans to re-process Europe’s largest manganese deposit, which is hosted in historic mine tailings in the Czech Republic, in order to produce high-purity manganese products (HPM) in an economically, socially and environmentally-sound manner.

EMN expect to become the only primary producer of high-purity manganese in the EU, where 100% of manganese requirements are currently imported.

Currently, the bulk of the world’s production of manganese ore occurs in South Africa, China, Australia, Brazil, India and Gabon.

Several prospective customers have expressed interest in procuring high-purity manganese products from the project, and in conducting supply-chain qualification of the products of the proposed Chvaletice demonstration plant.

Attracted by the strategic European position of Chvaletice, the incomparable low environmental footprint of the project (no mining or new solid waste generation), and the exceptional purity of the products that Euro Manganese has produced in previous pilot plant trials, five memorandums of understanding have been signed to date with major customers. These are intended to evolve into long-term offtake agreements.

Musk’s announcement today, could be a game changing one for manganese producers including the up and coming EMN.

Disclaimer: This article is sponsored content from Euro Manganese Inc (EMN) and does not constitute an endorsement by the publisher.