@firehawk08 Currently batteries only make up about 50% of all lithium (LCE) use. The 21% growth rate is of all lithium, the battery growth rate is over 40% pa.
The big hold back is not demand, demand for batteries is already higher than production with both Tesla and Audi cutting back production numbers because of lack of battery supply.
The problem is the cost and time to build and ramp up a battery factory. I've highlighted several times the cost of getting these battery factories up and producing is around the $US100-120M /Gwh. I don't think the sheer size of the commitment and expenditure is understood by most.
Economies of scale seem to kick in at around 8-10 Gwh from what I've read. I have spent thousands of hours on all this over the years. A 10 Gwh factory is going to cost over $US1.2B to build, a 100 Gwh factory around $US10B.
That kind of cash is not just lying around and the articles in the press of new giga factories being built often talk in terms of some hundreds of million being invested into it, without telling the whole story of that being only a minor part of the required funding!!
Have a look at these reports on the CATL factory in Germany, and how the plant size and money spent change, no mention of the cost of 100 Gwh!!
https://europe.autonews.com/automakers/volvo-picks-catl-lg-chem-supply-batteries-ev-push
"CATL, short for Contemporary Amperex Technology Ltd., is scheduled to start production at its 240 million euro factory in Erfurt, Germany, in 2022. That factory that will start by supplying BMW."
https://www.electrive.com/2019/02/04/catl-plans-up-100-gwh-battery-factory-in-germany/
"When the plans for Erfurt were first
reported during the summer, there was talk of a capacity of 14 GWh per year in the first stage. Production is scheduled to start as early as 2021. CATL planned to invest around 240 million euros in the site by 2022, at least these were the original plans. "
"At the Battery Forum Germany, CATL European unit head Matthias Zentgraf showed a slide in his presentation which indicated an annual production capacity of 60 gigawatt hours (GWh) from 2026."
" It quickly became apparent that even the 60 GWh capacity could be exceeded. “We thought in the middle of last year that the large orders had been awarded. But that was not the case. It goes further upwards,” said Zentgraf. “The inquiries of the automobile manufacturers are here! With realistic planning, we assume a demand of 100 GWh in the year 2025"
The original 240M Euros will not build the initial 14 Gwh factory.
On CATL, their revenue for the March quarter 2019 was $1.56b with net profit of $156m.
" With a market share of 41 percent, the company's total capacity of NEV power battery reached 23.4 GWh in 2018."
To be producing 100 Gwh of batteries in one factory in Germany will require a capital spend of around $10B. They will need to raise a lot of capital via equity raise as well as debt to do this, plus it will take a couple of years minimum to build a 100 Gwh factory.
From recently ..........
http://www.chinadaily.com.cn/a/201906/27/WS5d1401b3a3103dbf1432a7a5.html
" Battery giant Contemporary Amperex Technology Ltd will invest up to 1.8 billion euros ($2.05 billion) in expanding its European production and research base."
"According to CATL's earlier announcement, the project will start operation in 2021, and have the capacity of 14 gigawatt-hours by 2022"
Those that are 'counting' up the total battery factory capacities by certain years, what number are they using for this factory?? Is it 14 Gwh by 2022 or 60 Gwh or 100 Gwh in 2025??
Trying to look at reality instead of wishful thinking I would only use the 14 Gwh that is funded and for that rate of production to be starting in 2022.
Battery manufacture is the big bottleneck I see for the next decade with $US100B the cost to build that amount. The companies doing this do not have the capital and must raise it first!!
There will have to be a very good margin in battery manufacture continuing for years to be able to keep raising these enormous sums, but it will take time, then a few years to build them!
(20min delay)