I said this 5 years ago on Feb 2018, and will repeat it...

I said this 5 years ago on Feb 2018, and will repeat it again;

"All major automakers will have to build their own batteries as it's the key component of EVs. The competition to buy in stakes of lithium resource companies will be the major war soon"

Very simple;

1) All major automakers will have to build their own batteries otherwise they can't compete with the other EV makers which make their own batteries. The ones which don't make their own batteries will have to shrink and disappear quickly.

2) If an integrated EV-Battery maker doesn't own a large stake in a lithium mine or not owning it, it won't be able to find lithium at a competitive price to use in their batteries. Then it will lose its competitiveness and shrink, and disappear slowly.

3) The companies with FULL INTEGRATION of EV-Battery making and own a lithium mine or large stake in it will have major shares in the EV market.

According to these opinions it's obvious that Tier-1 lithium mine projects are very much valuable now.

I believe my LTR shares worth no less than $7 per share atm.

Because;

You can build 10 EV factories plus 10 battery factories in 2 years by investing the necessary money however you can NOT build EVEN ONE KATHLEEN VALLEY SIZE PROJECT IN NEXT 4 YEARS.


When we look at the largest EV companies in the world they are: Tesla and BYD.

They are both battery producers.


In the table above both BEV (Pure electric) and PHEV (Plug-in) EVs are included. Tesla sells more BEVs than BYD. See below.




THE COMPANIES WHICH ONLY PRODUCE BATTERY WILL ALSO BE IN PROBLEMATIC SITUATION.

CATL IS THE MAIN ONE AS IT HAS NO EV PRODUCTION.

THAT'S WHY CATL IS TRYING TO PROTECT ITS MARKET SHARE.

Here is the battery market share of battery producers in 2022.
CATL had 37% market share and was way ahead of both LG and BYD.

The problem for CATL here is the growth rate of BYD and other Chinese battery maker companies like CALB, Gotion, Sunwoda and Farasis in 2022. See below. They are growing significantly over 100% even some 250%.

Gotion is invested by VW over $1b euro two years ago.
Farasis produces for Mercedes.

CALB and Sunwoda have stolen CATL's EV maker customers Nio and Li Auto.
Nio, Li Auto and Xpeng all started small scale battery production and research for it in 2022.

Therefore CATL had to make special discount (200k Yuan for lithium carbonate which has no meaning for us) to Ni0 and Li Auto to get them back.



LG and SK On, two battery producer companies of Korea have both ambitious plans for getting huge share in the battery market in next years. LG is planning to increase its GWh capacity to 300GWh which is way above CATL's production capacity of 191GWh.

SK On also has big investments and JVs with US and European automakers and it targets to be number one of battery makers.

CATL knows its market share is in big danger.

I think the best thing for CATL to make a JV with one or more EV companies or buy out one.

The FULL INTEGRATION IS THE ONLY WAY TO GO FOR EV MAKERS.

As you can see on the schema I have made below, The EV companies with battery production capability are growing significantly. Tesla and BYD are two main companies.

Btw, the US and European automakers automakers have also involved in battery making. Ford is already LTR's customer, will buy spod and wants to build a battery gigafactory in the US with CATL. VW has committed to invest $20b euros in battery manufacturing. BMW has a lots of work and investment in battery manufacturing as well. All the other EV makers are aware that they have to build their onw batteries.

The FULL INTEGRATION IS THE ONLY WAY TO GO FOR EV MAKERS.

We can see on this schema that lithium mines will be very valuable.

Because;

You can build 10 EV factories plus 10 battery factories in 2 years by investing the necessary money however you can NOT build EVEN ONE KATHLEEN VALLEY SIZE PROJECT IN NEXT 4 YEARS.