Electric car revolution offers unrivaled investment opportunities in crucial energy battery materials equity markets
History learns that after the industrial revolution from the mid-1880s until the end of the 1990s, the 21st century high-tech revolution merging into the digital revolution, has created unlimited investment opportunities, as demonstrated by skyrocketing market valuations of global high-tech companies. Having been led by US-based companies, strong economic growth of Asian emerging countries is reflected in a growing share in multi-billion dollar valued companies, led by China.
This is reflected in historically unprecedented industrial and high-tech growth, as a result of which China has emerged to the world’s second largest economy, next to the US, since it became a member of the World Trade Organization in December 2001. Enhanced by strongly growing strategic investments abroad, China has emerged to the global leading mining industry, as the world’s biggest importer of industrial and base metals to secure its future economic growth, and is controlling most international strategic metals markets, including battery metals.
China’s dominant position in the metal commodity markets has been strengthened since 2016 driven by the start of the electric car revolution as a response to the Paris Climate Agreement under auspice of the United Nations to lower CO2 emission to at least 2° Celsius.
As a result, electric cars containing lithium-ion batteries are offering unrivaled investment opportunities in lithium and cobalt as the most crucial metals. In addition, also graphite, magnesium, vanadium and rare earth metals neodymium and praseodymium, collectively known as NdPr, expected to benefit from significant rising demand.
China leads electric car revolution
In the third quarter of 2017 global sales of EVs soared 63% compared to the same period last year, 23% compared to the second quarter. A total of 207,000 units were reportedly sold in the September quarter. Leading Bloomberg New Energy Finance projected total sales in 2017 to exceed 1 million units for the first time. As the world’s largest auto market China was responsible for about half of the sales last year as the crackdown on polluting industries has propelled renewable alternatives from power generation to consumer products.
Only being the beginning of the anticipated electric car boom, Bloomberg New Energy Finance forecasted 60 million electric cars through the year 2040, with China the US and Germany to push the adaptation of EVs forward, many analysts believe that by 2040 the global EV market could exceed 60 million vehicles sold per year.
- Types of lithium-ion batteries
- China, as the largest EV market, projects penetration rate of 17% by 2035
- Chinese automakers are moving the fastest to meet surging demand
- Cobalt scarcest vital material in electric vehicle chemistry
- Top-11 cobalt mine producers (Mt)
- DRC revises mining code to capitalize on cobalt boom
- Vanadium redox flow batteries to benefit from the EV revolution
- Magnesium lightest of all light metal alloys
- Key differences - Magnesium versus Manganese
- Overviews of listed strategic metals companies, as of June 30, 2018