EVs will rise as fast as factories can make batteries to supply them.
It's not that people don't want EVs, the demand is there, but they can't make enough batteries to warrant campaigns to sell them... Yet. - Tesla and a handful of vertically integrated Chinese companies excepted.
LGs recent spat in response to VW's SK partnership says it all. Paraphrased: "if you decide to make your own batteries, we'll cancel your multi-billion dollar battery contract with us." - How does LG have the balls to contemplate this threat? Because they know another customer will be waiting in line to fill VWs order.
So don't follow EV sales, follow battery factories and as the phrase goes: if you build it, they will come... Here's a graphic from Benchmark minerals, taken from Simon Moore's Tweet:
The red lines are 2018 battery capacity. The yellow ones are the capacity in 2023. I count 40 factories today and 28 more built in the next 4 years. In total, including increases from current factories, capacity goes from about 350 GWhr today to about 1TWhr in 2023. NB I haven't even considered the blue which is 2028, but that will be dynamic in any case over the next few years.
Assuming these get built, it follows that EVs will rise to about 6 million/yr in 2023 compared to 2m sold in 2018. it's a VERY rough assumption, but the point is lithium ion capacity will grow at this rate and for arguement's sake I'll assume that EVs will approximately follow the same trend (perhaps Li-ion storage will take a larger slice, but you get the idea).
Read-through from company announcements is the current battery-grade lithium market is tight. Looks like supply will have to triple in the next 4 years...
----As a side note: c'mon Australian govt/ship and weapons builders/Unis/tech companies etc - Either research like hell, buy experts and develop the batteries here, or entice foreign companies to Perth and we'll at least learn by osmosis.
KDR Price at posting:
$1.24 Sentiment: Buy Disclosure: Held
