The coming tsunami of electric car demand will need many more anode megafactories and graphite

MATTHEW BOHLSEN | APRIL 29, 2019 | 1 COMMENT

Most investors don’t yet understand the tsunami of electric car demand that is just around the corner. Bloomberg New Energy Finance forecasts that by 2020 there will be over 289 different models of electric cars. Just recently Bloomberg has revised their targets now saying the same as I have said for the past 3 years. Bloomberg now says by 2022 electric cars will become price competitive with conventional cars. Previously they said by 2025. Even Volkswagen predicts that EVs will go mainstream in 2022.

By 2022 an electric car should be cheaper than a conventional car, and will be up to 10x cheaper to fuel, and up to 10x cheaper to maintain. At this point electric car sales will go through the roof as buyers will be significantly better financially owning an electric car.

The Porsche Taycan all electric car already has a 20,000 waiting list.

Majority of British car owners say they would consider buying an electric vehicle as their next car. Analysts continue to upgrade their forecasts for electric car penetration rates, the latest is JP Morgan. CNBC reported that JP Morgan forecasts “electric cars would take 35 percent of the global market by 2025 and 48 percent by 2030.”

After 2022 massive electric vehicle (EV) demand will lead to long electric car waiting lists, shortages of batteries, and shortages of key EV materials such as lithium, cobalt, nickel, and graphite. The EV battery materials supercycle will have begun.

Graphite will be one winner of the EV boom

Graphite is currently an essential element in the making of lithium ion batteries. Demand for battery grade natural graphite (and spherical graphite) for anodes used in batteries needed for consumer electronics and electric vehicles is rising rapidly, and will go exponential from 2022. Added to this will be graphite demand for more lightweight materials made from graphite such as carbon fiber reinforced plastic used in automobiles and manufacturing components for aircraft, as well as the steel industry.

EV metals expert Chris Berry recently stated: “The ‘pinch’ in graphite is yet to be felt, but I anticipate upward pricing pressure by 2020, breathing new life into non-Chinese natural graphite development companies.”

China has historically accounted for 70% of graphite production, and is now rationalizing production capacity thanks to resource depletion and environmental concerns.

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