Global automakers are planning an unprecedented level of spending to develop and procure batteries and electric vehicles over the next five to 10 years. Reuters have analysed public data released by those companies and their plans to spend at least $300 billion on EVs are driven largely by environmental concerns and government policy, and supported by rapid technological advances that have improved battery cost, range and charging time.
We are in a lithium-ion revolution…
Benchmark Mineral Intelligence forecasts that we will see a 399% increase in lithium-ion battery production capacity over the next decade – enough to pass the impressive 1 TWh milestone.
The EU is planning to allow state aid for electric battery research and will offer billions of euros of co-funding to companies willing to build giant battery factories.
Our global long-term Electric Vehicle Outlook (EVO) forecasts EV adoption out to 2040 and the impact that electrification will have on automotive and power markets, as well as on fossil fuel displacement and demand for key materials.
“Our latest forecast shows sales of electric vehicles (EVs) increasing from a record 1.1 million worldwide in 2017, to 11 million in 2025 and then surging to 30 million in 2030 as they become cheaper to make than internal combustion engine (ICE) cars. China will lead this transition, with sales there accounting for almost 50% of the global EV market in 2025.”
- By 2040, 55% of all new car sales and 33% of the global fleet will be electric.
- China is and will continue to be the largest EV market in the world through 2040.
- EV costs. The upfront cost of EVs will become competitive on an unsubsidized basis starting in 2024. By 2029, almost all segments reach parity as battery prices continue to fall.
- E-buses. Buses go electric faster than light duty vehicles.
- Displacement of transport fuel. Electrified buses and cars will displace a combined 7.3 million barrels per day of transportation fuel in 2040.
Demand for lithium, one of the key materials used in making lithium ion batteries, is rising rapidly. The metal is used in a wide variety of industrial applications including glass, ceramics and greases, but it’s the use of lithium as a key component in the batteries that power electric and hybrid electric vehicles that has so excited markets.
If electric vehicles, which rely wholly or partly on electricity stored in batteries as their source of energy, revolutionize road transport in the way many expect, demand for the metal will rise exponentially. China will be at the forefront of this.