Electric-vehicle manufacturer Tesla Inc. outlined various new strategies during its recent Battery Day event, including plans to build its own battery cathode manufacturing plant in North America, with company executive Andrew Baglino citing the potential for savings and environmental stewardship.

The company would also start "leveraging all of the North American resources that exist for nickel and lithium" as part of this plan, Baglino said. CEO Elon Musk added: "It is important to note that there is a massive amount of lithium on Earth … Lithium is not like oil. There is a massive amount of it pretty much everywhere."

This dream of building a local metals supply, where a manufacturer oversees its materials from mine to finished product, is not new to the EV market. Industry observers say reliable sources of battery metals may be necessary to make electric cars affordable and plentiful enough to widely deploy them in the U.S. and elsewhere, a step some say is needed to limit global warming and avert a permanent climate catastrophe.

However, the ways in which mining companies, battery-makers and automobile manufacturers invest in that vision could very well depend on who wins the U.S. presidential and Senate elections in early November.

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"Fundamentally, batteries will end up underpinning the decarbonization of the power market and transport market, and exercising a degree of control over that supply chain is pivotal for many of these politicians," BloombergNEF analyst Logan Goldie-Scot said in an interview.

U.S. President Donald Trump and former Vice President Joseph Biden both say they want to use the regulatory power and bully pulpit of the White House to reestablish the country as a manufacturing hub and reduce Chinese influence over supply chains, including mineral supplies. A Trump administration official told Reuters in early May that the government was "turbocharging" efforts to reduce supply chain reliance on China. Biden also has a comprehensive plan to "rebuild" U.S. supply chains using federal purchasing power and other executive authorities.

But that is where the similarities between the candidates end. A second Trump term would all but certainly mean the easing of longstanding federal regulations, including the entire environmental permitting process, which the mining industry hopes will boost U.S. mineral production. It would also result in continued litigation against state-level clean car standards that are favored by some in the auto industry and could accelerate the country's switch to electric vehicles.

Meanwhile, Biden has promised to reverse many of the regulatory rollbacks attempted by the Trump administration and enact sweeping legislation addressing climate change. While his campaign has not released a plan specific to mineral security, his Democratic allies in Congress have released detailed plans to tackle U.S. climate policy that include increasing supplies of battery metals but emphasize research in sustainable mining practices that prioritize the health and wellbeing of communities in and around job sites.

"A national commitment to responsible mining, reclamation, and recycling within the United States can provide supply chain security, create jobs, and support American industry and leadership while protecting the environment," an Aug. 25 report from Senate Democrats' Special Committee on the Climate Crisis stated.

Cutting rules at a cost

Goldie-Scot said between the two options, greater investment in the U.S. battery supply chain is more likely if Biden wins the White House. Climate-focused legislation and ending the lawsuit against stricter state standards for auto emissions could lay the groundwork for meaningful upticks in EV consumption, therefore motivating companies to put more money into U.S. manufacturing processes.

If the challenge of the lawsuit goes away, and if the U.S. implements stricter standards alongside the significant amount of content published by Biden on direct investment in manufacturing and direct procurement, more manufacturing activity would be likely, Goldie-Scot said.

This is partially because of environmental, social and governance-related pressures on manufacturers, he said. Companies are scrutinizing the environmental performance of countries as they consider locations for new plants. Ranking the top 10 countries that are set to be a factor in the global battery supply chain through 2025, BloombergNEF placed the U.S. in sixth place, behind China, Japan, South Korea, Canada and Germany. The mid-September rankings were based on a country's trajectory as relevant to global raw battery materials, cell and component manufacturing, environmental stewardship, regulations, infrastructure and end demand.

BloombergNEF identified the U.S. as lagging other top nations on mineral availability as well as environmental protection. One method to improve the country's standing would be the implementation of a carbon adjustment mechanism to put a cost on imports from nations with lower emissions standards, which is a proposal that Biden has put forward, Goldie-Scot said.

Support in Congress

If elected, Biden would also find significant bipartisan support for minerals security legislation in the U.S. Congress.

Senate Democrats and Republicans back a sweeping package of clean energy bills known as the American Energy Innovation Act, which would also enshrine critical mineral policies into U.S. law. The bill would require the government to identify undefined resources throughout the country and set timelines for permitting extraction of those deposits. There is a chance the bill will become law prior to the 117th Congress, depending on the timing of other legislative priorities and the possible confirmation of a new U.S. Supreme Court justice.

Environmentalists are also urging the future administration to consider sustainability when setting policy around battery metals. A coalition of conservation groups including Trout Unlimited and the National Wildlife Federation released a report in August putting forward steps to protect biodiversity and promote public input regarding decisions to secure U.S. critical mineral supplies. The Aug. 24 report, which was endorsed by Kinross Gold Corp., calls on the government to prioritize alternatives such as recycling or mineral substitutes before advancing new mines.

The groups behind the report acknowledge that it is "quite possible that additional mines may be needed to meet the mineral needs of the future, but there is a balance to strike," Ty Churchwell, mining coordinator at Trout Unlimited, told S&P Global Market Intelligence.

"We can't mine ourselves out of this supply chain problem, it requires a more holistic approach and the issue is not more holes in the ground necessarily," Churchwell said.