Supply Chain What do we see as impact? Introduction Protecting human rights and the environment is core to our procurement strategy. Tesla creates our products from many different materials and components, some of which we purchase from our direct (Tier 1) suppliers. Many of our Tier 1 suppliers do not purchase all their raw materials directly, rather they get them from their suppliers and sub-suppliers around the world through a complex supply chain. Though we believe that battery recycling will play a critical role in supplying a portion of these materials to enable a closed loop supply chain, we recognize that global battery cell production will continue to rely heavily on primary, mined materials to meet the growing demand for our products. In line with our mission to accelerate the world’s transition to sustainable energy, Tesla is committed to ensuring that companies in our supply chain respect human rights and protect the environment. Our goal is that where Tesla’s supply chain touches, local conditions for stakeholders continuously improve as a result of our purchases. Our responsible sourcing strategy has the following objectives: 1. Increase the share of materials we source directly from suppliers, and those closer to our factories (supply chain localization); and 2. Continue to source globally, to contribute to the improvement of local conditions in our sourcing communities. Mapping GHG emissions in the battery supply chain is one of our top priorities Upstream GHG emissions from manufacturing an EV battery – from raw material extraction through refining and transportation of materials – can be meaningful. We estimate that these specific activities cause up to ~80% of the total emissions of a Model 3 battery pack, with the largest contributors at the chemical processing stage. Our battery supply chain GHG emissions hotspot analysis – an industry first – is on page 104 of this report. ~12 ton of rock mined Refined electrode material Produce a battery pack Produce a battery pack Produce a battery pack Refine Recycle Recycle Recycle 95