According to new forecasts, the lithium market is expected to double by 2030 as demand for electric vehicles picks up.
is that finally possible? Have we reached the threshold for mass adoption of electric vehicles? Many older automakers are reporting a surprise surge in EV sales. In fact, some find it difficult to keep up with the demand.
CEO Jim Farley commented on Ford’s second-quarter earnings call: “We sell them [EVs] As soon as we can make them.” The company plans to reach a run rate of 600,000 EVs by the end of next year and 2 million EVs by 2026.
And Ford isn’t the only company planning to ramp up electric vehicle production. Essentially every automaker has announced that they intend to, or intend to, go fully electric in the future.
- By 2030, Mercedes-Benz wants to be fully electric.
- General Motors (GM) says the automaker is reaching an EV tipping point.
- Hyundai is targeting 7% of the global BEV share, while Genesis will launch all EV models from 2025 onwards.
And that is just the beginning. Volkswagen, Toyota and all major automakers have big plans for the EV industry and are trying to catch up with current EV leader Tesla.
Meanwhile, automakers ramping up electric vehicle production are creating huge demand for lithium. Lithium is an important mineral used in EV batteries. In fact, Lithium Ion (LiOH) batteries are the most popular choice due to their ability to produce high levels of energy at safe levels.
Mercedes-Benz battery plant in Alabama Source: Mercedes-Benz
Lithium is key to huge demand for electric vehicles, but supply is limited
The lithium market is valued at around $7.5 billion, up nearly 10% year-on-year, according to a new report. And experts believe demand will pick up from here as automakers ramp up production of electric vehicles. With new sustainable energy (EV) incentives, automakers are investing billions in electrifying their fleets.
Grand View Research says:
The rapid development of battery technologies is driving the demand for LiOH and hence the growth of the market
Global automakers plan to invest more than half a trillion in EV and battery technology. Because of this, lithium prices are up more than 400% compared to 2021 and remain near record prices.
Meanwhile, new clean energy incentives are expected to push the market even higher. The Senate has approved the largest climate bill ever with more than $400 billion in clean energy funding over the next 10 years.
With this in mind, Grand View Research estimates lithium market revenue at $18.99 billion, up 153% compared to this year ($7.49 billion).
At the same time, lithium mining is expected to accelerate here in the United States. Last January, the Bureau of Land Management gave the go-ahead for Lithium Nevada Corp’s Thaker Pass mine. The Thacker Pass Mine is expected to be the largest source of lithium in the United States by 2026 with a production capacity of approximately 80 kilotons.
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