It's perhaps worth noting that musk has said:

> I will announce locations for between two and four Gigafactories later this year – probably four.

This puts them in the range of around 175 (35 * 4 new + Nevada) gigawatt-hours annually. They are certainly looking to compete in this space

It's worth noting though that the estimates for the Gigafactory have been massively revised (although no one seems to pay any attention to it) and will now be producing 100+ GWh of batteries yearly and Musk had stated that they're announcing 2-4 more this year.

Relative to the companies their stock is being compared against I'd say I'm still pretty impressed with their lithium-ion production plans.

Further, the Chinese government can say "fuck you" (as they have done with other companies) and make it prohibitively expensive to obtain the raw materials used for battery production.

Incorrect.

China comes number four on the list of lithium producing companies.

Much of the world's lithium reserves seem to come from South America.

http://investingnews.com/daily/resource-investing/energy-inv...

You need other minerals, which are collectively termed "rare earth minerals":

Rare earth element map: In 2013, China produced about 90% of the world's supply of rare earth element ores. The USGS Mineral Commodity Summary [2] reported production tonnages for Australia, the United States, India, Brazil, Russia, Vietnam, and Malaysia. Rare earth element exploration and/or development is being done in Canada, South Africa, Thailand, Malawi, and Sri Lanka; however, production from those countries was insignificant during 2013.

http://geology.com/articles/rare-earth-elements/

Further China has already show willingness to ban export of these materials (for example in 2010). At the end of the day the risk to the production of batteries in particular has motivated vulnerable countries like Japan to develop alternative processes:

http://fortune.com/2016/07/12/honda-rare-earth-battery-hybri...