Lithium price surge ‘jeopardizes energy transition efforts’

Posted: March 25, 2022 by oldbrew in Batteries, Energy, Travel, Uncertainty
Tags:

BMW i3 electric car plus battery pack [image credit: carmagazine.co.uk]


Unlucky. It’s not just lithium either. Nickel prices are going crazy as supply problems loom. The notion of EVs competing on price with fuel burners any time soon is receding fast, if not dead in the water.
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Soaring lithium prices are threatening energy transition efforts as EV battery makers will be forced to hike the prices for their products by as much as 25 percent, Morgan Stanley has warned.

Over the past 12 months, the bank said, as quoted by Bloomberg, the price of lithium carbonate, which is a key ingredient in electric vehicle batteries, has jumped five times.

This may force EV manufacturers to hike prices by up to 15 percent, hurting demand, reports OilPrice.com.

The news comes at a bad time for EVs. Rising retail fuel prices in some parts of the world, such as the United States, are driving higher EV demand, but carmakers are already finding it hard to satisfy it amid persistent supply chain problems and the rising prices of most raw materials.

The conclusions of Morgan Stanley analysts echo those of a Chinese EV manufacturer. Earlier this week, Li Auto Inc’s chief executive Li Xiang said on social media that “The cost of batteries in the second quarter rose by a very ridiculous amount.”

Full report here.

Comments
  1. […] Lithium price surge ‘jeopardizes energy transition efforts’ […]

  2. pochas94 says:

    Somebody should consider the economics of subsidizing battery cars vs providing enough fueling stations to make hydrogen practical.

  3. ivan says:

    pochas94, I think it would be much cheaper and safer to push for LNG powered cars – no fear of explosions from leaking hydrogen plus it doesn’t require all the extra electricity to make it.

  4. Phoenix44 says:

    And not just new EVs if it stays like this. If a second hand EV needs a new battery pack and that’s now £15,000 instead of £10,000, there virtually no value in the EV itself. The economics of the car market relies on second hand cars having substantial value.

  5. Chaswarnertoo says:

    Who’d a thunk it? Anyone with half a brain.

  6. Gamecock says:

    ‘The economics of the car market relies on second hand cars having substantial value.’

    Indeed. Even leasing new becomes impossible if future value can’t be reasonably predicted.

  7. oldbrew says:

    The future value of an EV can be reasonably predicted – declining to near zero after 8-10 years, with normal usage. By then its range will have declined significantly, due to inevitable battery degradation — a bit like an already small fuel tank getting smaller every year.

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