Economics distortions, page-19

If you Build it they will come!! ???????

Giga sized fails

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making batteries should be about as solid a business as one could imagine: practically a licence to print money. Hundreds of billions of dollars, euros and renminbi are being invested in battery gigafactories in an attempt to profit from the coming revolution.

But as the wave of money hits, battery manufacturing is becoming less of a gold rush and more of a brutal race to the bottom. Huge investments in factories as well as ultra-low raw material costs, combined with stalling demand for electric cars, have pushed the world into oversupply.

The glut has been a boost for motorists, who are seeing the price of electric vehicles (EVs) fall dramatically, but now risk thwarting investments in new factories needed for the next decade as the West seeks to build its own supply chains away from Asia.

Earlier this month, SK On, the South Korean battery giant, declared that it was in a state of “emergency management” after continuing losses and disappointing EV sales among the Western car makers that make up its biggest customers. The company has recorded 10 quarters of consecutive losses and delayed plans for a giant battery factory in Kentucky amid a sales slowdown.

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Tesla down 12% of so on Friday may also be an indicator? Musk may have been a front runner in Giga scaled using other people's money of course!