Tesla Bought Russian Aluminum To Make Body Shells For Model Y

Tesla, Inc. purchased millions of euros worth of aluminum from Rusal, the second-largest aluminum supplier in the world, which is based in Russia, according to new internal documents obtained by CNBC.

Several current and former employees of Tesla provided CNBC with invoices of the purchases, though they wanted to remain anonymous, citing fear of retribution. They said the electric vehicle maker purchased millions of euros worth of Russian aluminum to make body shells for the production trials of the Model Y at its new manufacturing facility in Brandenburg, Germany. No details were provided in the documents that suggested Rusal aluminum was shipped to the US. 

Western countries have sanctioned Russian tycoon and Rusal founder Oleg Deripaska. The billionaire is a close associate of Russian President Vladimir Putin and has called for peace in Ukraine. 

About a week ago, Deripaska said, “the whole world will be different after these events, and Russia will be different.”

Rusal is not Tesla’s primary aluminum supplier; the automotive company has worked with other metal suppliers over the years. The invoices didn’t provide information on how much aluminum Tesla obtained from Rusal. 

The documents showed a German subsidiary of Tesla paid the Swiss subsidiary of Rusal through an Austrian bank for the metal. 

Tesla began sourcing aluminum from Rusal for casting car parts in December 2020 and continued purchases through February 2022. 

There’s no word if Tesla has run into sourcing issues for Rusal aluminum. Still, Musk made it very clear Sunday night that “Tesla & SpaceX are seeing significant recent inflation pressure in raw materials & logistics.” 

Tesla & SpaceX are seeing significant recent inflation pressure in raw materials & logistics

— Elon Musk (@elonmusk) March 14, 2022

Industrial metals have skyrocketed as Western sanctions isolate commodity-rich Russia from the rest of the world. 

After the largest commodity spike on record, Tesla began raising car prices last week. 

Interos, which monitors global supply chains using machine learning software, said, “the invasion of Ukraine by Russia is literally an invasion of the global supply chain by Russia.” 

“In response, we are literally cutting parts of our developed supply chain off through sanctions and war. Companies are responding by doing two things– one is stockpiling, buying as much as they can as rapidly as they can. Beyond that, they are looking for alternative sources whether that’s from another place or from another metal or material that they can use as a substitute.” 

Meanwhile, Musk has vocally supported Ukraine even though Tesla’s supply chains are intertwined with Russia. It remains to be seen if Tesla continues to purchase Russian aluminum.