Benzinga | Jan 31, 2022 05:37AM EST

Tesla Co-Founder Says Battery Recycling Venture Not Profitable Yet But Here's Why He's Not Worried

Tesla Inc (NASDAQ:TSLA) co-founder JB Straubel said his battery recycling venture Redwood Materials is not profitable yet, the Associated Press reported on Sunday.

What Happened: Straubel, who launched the battery recycling startup in 2017 -- nearly two years before officially leaving Tesla-- said the venture is, however, growing quickly and reinvesting and it will continue to do so for a "quite a few years."

"The actual unit operations of recycling these batteries...that is profitable today and there is an enormous amount of buyers," Straubel said.

"There's really quite a hunger in the market for these materials in any form."

See Also: Tesla Co-Founder's Battery Recycling Company Ties Up With E-Waste Firm ERI

Why It Matters: Redwood is building the world's first end-to-end supply chain for electric vehicles and clean energy products.

Straubel left Tesla in 2019 to focus on Redwood and work on recovering and recycling elements such as cobalt, lithium, nickel and copper. The demand for metals such as lithium, graphite, nickel and manganese is on the rise due to the increasing shift to electric vehicles.

The Nevada-based startup is currently building a materials facility that would "produce 100 GWh of cathode to produce 1 million electric vehicles and 500 GWh for 5 million vehicles in 2030." A location for the site is expected to be revealed soon.

Price Action: Tesla shares closed 2% higher at $846.4 a share on Friday.