Tesla recently made history by being the first automaker to hit a market cap of over $1 trillion. This all but proved that the electric vehicle transition is here, and EVs are here to stay. With the automotive industry seemingly now waking up to the notion that a shift to electric cars is inevitable, however, a shift in the battery industry seems to be happening.
Batteries for electric vehicles are now seeing a price hike in China, with the cost of raw materials such as lithium seeing a substantial increase in price. With this trend in mind, industry research group Benchmark Mineral Intelligence (BMI) noted in a recent report that electric vehicles may face rising battery costs in the coming year.
What is interesting is that the price hike of battery materials is happening while the industry is becoming more and more prolific. Expectations for electric car batteries have long pointed to the idea that high-performance batteries should decrease in price over time as economies of scale accompany an expanding EV market. And in previous years, this has generally been the case. As per BMI chief executive Simon Moores, however, the price hikes for raw materials in China could end up raising battery prices instead.
Moores noted that if Korean and Japanese battery makers such as LG and Panasonic follow China’s lead, the price of batteries using nickel, cobalt, and manganese cathodes could rise to about $115 per kWh next year. The BMI chief executive noted that this year, nickel,...
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