Tuesday, April 5, 2016

Raw material supply is now the issue for electric car makers



INN: What could all of this excitement over the Model 3 mean for lithium demand?

SM: With pre-orders at nearly 200,000 in 24 hours, it could do a lot for lithium demand.
The question is all about the batteries now for Tesla. They need to learn how to build low-cost lithium-ion batteries at scale. So getting the gigafactory up and running and securing the supply of lithium, graphiteand cobalt is crucial.

Demand is no longer an issue in this market. Raw material supply security is now the critical factor.

I have positioned myself to take advantage of what I predict is going to be a possible train wreck on the material supply side for these EV manufacturers. The demand is not only for cars but battery storage for intermittent wind and solar energy along with the proliferation of portable electrical equipment. If Musk is able to do what he says and produces 500k cars per year Tesla alone will have to absorb the entire worlds lithium production. Listen to what he says at 14:30. Prices for lithium and cobalt will have to rise in order for this to happen and virtually no one is talking about it in the mainstream financial media. 

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