Battery Supply Chain Prioritization of cobalt, lithium and nickel #1 The Tesla Approach Given their unique significance to the success of EVs and energy storage, Tesla has a dedicated responsible sourcing program for three priority minerals in the battery supply chain: cobalt, nickel and lithium. We prioritize these raw materials for the following reasons: 1. Commercial importance: Cobalt, lithium and nickel are the key raw materials used in cathode production, represent about a third of the total costs of a battery cell and play an essential function in improving vehicle range and safety performance. 2. Potential environmental and social impact and scrutiny: Cobalt, lithium and nickel are also ‘minerals’ – in that they are raw materials that are produced through different methods of mining around the world, often concentrated in countries that face socio-economic and environmental challenges. As known global reserves are depleted, these minerals are becoming increasingly scarce, and companies look to access resources in more remote and challenging locations to meet global demand. Cobalt, lithium and nickel are also classified as critical minerals by the United States, European Union and Canadian governments because they are essential in enabling a transition away from fossil fuels to a low-carbon economy. As a result, the impact of mining activity on the environment and local communities lends itself to greater environmental and social scrutiny from civil society, policymakers and investors. Mining has an important role to play in the transition to sustainable energy and we engage with suppliers to ensure mining is done in a responsible way. This is one of the reasons Tesla joined the Initiative for Responsible Mining Assurance (IRMA) and uses the IRMA Standard as well as other internationally recognized responsible mining standards in our due diligence. 99