It is known that lithium, which is considered at the heart of the transition to electric cars, has been entangled in a full-blown crisis.
Recently, David Sacks, founder of social network Yammer and former COO of Paypal, shared on his personal Twitter about the problems facing the national energy industry: “There will be no guarantees as we go. not energy independent, if what happens this year proves to be true.”
In response, billionaire Elon Musk clearly agreed: “Definitely so. Lithium batteries are the new type of petroleum.”
Musk’s above comment immediately attracted more than 26.5 thousand likes and nearly 2,000 retweets, with a large number of supportive comments from social network users. This is not the first time that the richest billionaire on the planet has affirmed the importance of lithium battery technology – a battery that applies advanced technology to help ensure safety, reduce the risk of fire and explosion and have a fairly long life. .
In April, Musk also shared on Twitter that Tesla may enter the field of refining and mining lithium batteries because their prices are skyrocketing. According to statistics from Benchmark Mineral Intelligence, the price of this battery has increased by 280% in 2021.
“Lithium price increase is crazy!. Unless input costs improve, Tesla may have to directly mine large-scale lithium,” Musk said.
Demand outstrips supply, causing lithium prices to be pushed up nearly 500% in just 1 year
It is known that lithium, which is considered at the heart of the transition to electric cars, has been entangled in a full-blown crisis. The situation when demand outstripped supply caused prices to be pushed up by nearly 500% in just 1 year, and disrupted all efforts to prevent global warming.
The lithium crisis is so severe that the Chinese government, which produces about 80% of the world’s lithium-ion batteries, has to speak out to encourage suppliers to reduce prices. Experts at Macquarie Group warned of a “permanent lithium deficit” scenario, while Citigroup forecast the precious metal’s price would double in an “extreme” way in 2022.
At the end of April, half of the electric vehicles Tesla produced were equipped with pithium batteries instead of the nickel and cobalt batteries favored by Western manufacturers. Many experts say that many other automakers, including Tesla, need to consider investing more in nickel and cobalt to avoid the risk of commodity price shocks.
According to Bloomberg, global investment in electric vehicles has grown faster than any new energy sector in the past few years, outstripping both wind and solar power. Benchmark Mineral Intelligence estimates that at current spot lithium prices, the cost of a new electric vehicle will have to increase by $1,000. Along with the price increase of other raw materials, efforts to reduce the price of electric cars to compete with gasoline cars after many years may fail. In addition, battery manufacturers do not have the necessary amount of lithium, which also limits plans to expand the supply of electric vehicles, thereby making it difficult to reduce emissions.
Lithium mining requires a huge amount of water
“The auto industry is facing a price storm due to rapidly escalating costs,” said XPeng electric car company president Brian Gu.
“It seems that efforts to improve supply will not be able to meet all demand in the next three years. Electric vehicle manufacturers seem to have “fallen asleep at the wheel,” said Cameron Perks, an analyst at Benchmark.
Source: Bloomberg
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Source: Vietnam Insider