I was just looking at the latest Goldman Sachs research note on...

I was just looking at the latest Goldman Sachs research note on lithium titled "Lithium: The short trade must go on" and was amused by their EV sales chart which shows weak EV demand. In particular, I love the red arrow to highlight the direction of where this is undoubtedly heading:

The 1st impression of looking at this chart is "wow yeah EV demand is softening" but you need to look at the effort they have gone to in order to paint the picture in this way:

1) They are showing "YoY change" in absolute terms. That is, the bars are showing the increase over and above the previous demand for the same corresponding period. However, the way they present it (with a heavily negative bias) we are supposed to get the impression that demand is reducing. On this chart if the 2023 bars (the last 3) were just slightly above zero it would still mean we have another record breaking year. They don't talk about the growth rate in 2023 which is around 30% because that just sounds bad (conflicts with their narrative). It's much better to talk about the reduction in absolute numbers:


2) They are only showing the data for China... because the situation looks better if you were to incorporate the rest of world. China has had the lowest increase in EV demand/sales over the past year. If they are not attempting to game the numbers why do they not present the data for the entire world given that we are talking about a global lithium market? I'm sure they would argue "because China is the biggest market", but the problem here is they are conveniently ignoring almost half the picture.

3) They are only showing the data which compares 2022 to 2023... because if you show the data over a longer period you get a sense of the exponential increase in sales that we are experiencing. And they don't want to show that... it conflicts with their agenda.

To put this in context the chart below is from a recent Bloomberg article (sourced from Twitter) which shows global sales since 2015. Basically the Goldman Sachs chart above is trying to show us that the increase in EV sales in China between 2022 and 2023 has increased a slower rate compared to the increase in China between 2021 and 2022. I have highlighted this on the chart below. So what Goldman Sachs is showing us is that the highlighted red increase in China sales is smaller than the highlighted green increase of the previous year. When you look at it in the context of this chart below it looks pretty silly (i.e. its lacking perspective).


So while these 2 two charts don't conflict with each other, they paint a completely different picture. It just amazes me the effort that Goldman Sachs are going to in order to push their narrative... at some point it will come undone.

It's also interesting that the rules on the Chinese Lithium Futures exchange have now been changed. Why change the rules now I wonder? I suspect they are not nearly as interested in it moving up as quickly as it has moved down.