According to a survey from UBS last year, one in six cars sold in the world by 2025 will run on electricity or 16% of all cars. Total new vehicle sales that year are projected to rise to 120 million. That could mean 19 to 30 million new electric vehicles all requiring huge batteries.
Those figures would indicate a huge demand increase--but that 16% market penetration figure in 6 years could be light considering China is already at 4% and
Europe is still providing huge tax incentives for buying electric vehicles--as is the US. That’s especially true when brands like Volkswagen and Mercedes are
planning to electrify their entire fleets.
But even at the relatively conservative estimates, demand doubles from the current 200K tons per year to over 400K tons by 2022 -- and quadruples by 2026.
The key to understanding lithium demand is that is not just for booming electric car sales. There is plenty more demand for other EVs - e-buses, e-trucks, e-ships,and e-boats, e-bikes, and some day e-planes (although these are the furthest away with the biggest obstacles to becoming reality)--plus the energy storage and electronics sectors.
Within the next two years, e-semis and electric trucks will be rolling down our highways. In late 2018 Daimler announced two new electric trucks for the US market to take on the Tesla Semi that was slated for 2019-2020 production. A full-size electric semi-truck will need about 10-16 times more batteries (and hence lithium) than an electric car. That is equivalent of a mind-boggling 70K - 112K laptop batteries!
Massive demand is already coming out of China. Bejing has mandated that by 2020 there will be at least 220K electric buses in the public transit system in its major cities.
The current design contains about 241 kilograms of lithium. That;s over 53 million kilograms of lithium required just to get these electric-powered buses on the road.
Morningstar analyst David Wang said " We expect lithium demand growth of 16% annually over the next decade, faster than any major commodity over the past century."
Morningstar is forecasting a 100K ton annual shortfall in supply by 2025
ABML will be busy recycling, drilling and extracting lithium from their own mines and licensing their advanced extraction process for a long time just to keep up with a world whose insatiable demand for lithium will only increase as EV is adopted in nearly every aspect of transportation.
Now is the time. ABML is the company.
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