Electric Vehicle And Battery Metal News (March 2019)

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Includes: AMZN, KIMTF, TSLA
by: Gregor Gregersen
Summary

Nickel demand for batteries is rising at a time when its price is too low to incentivize new project development.

Electric vehicle charging infrastructure continues to improve with innovations from Tesla and Kia/Amazon partnership.

Fleet operator in New York City confirms that the operating costs for full electric vehicles are lower than gas or hybrid vehicles.

We are witnessing a generational shift towards the electrification of energy. The growth in the development of the electric vehicle market is astounding. Billions in investments are pouring in to drive research and development in EV batteries, superchargers and new EV models. Here are the latest developments in the electric vehicle and battery metals markets.

1) Chinese electric vehicle makers are gorging on nickel.

  • Chinese electric vehicle manufacturers deployed 253% more nickel in passenger EV batteries in January this year compared to 2018.
  • Increase is attributed to an ongoing shift from lithium iron phosphate (LFP) to nickel-cobalt-manganese (NCM) cathodes.
  • China is now the largest market for passenger EV battery nickel, ahead of Japan and the US, which were the two largest markets in January 2018.

2) Nickel demand growing thanks to EV boom.

  • One of Australia’s largest high-grade nickel producers, Western Areas (OTCPK:WNARF) (ASX: WSA), reported a significant increase in inbound off-take inquiries for nickel sulphide concentrate.
  • Rise in inquiries attributed to the accelerating electric vehicle battery sector.
  • The need for nickel is starting to rise at a time when its price is too low to incentivize new project development.

3) Tesla (NASDAQ:TSLA) is in talks with a Chinese battery giant to power Model 3s made in China.

  • Tesla Inc. is in talks with top Chinese battery producer Contemporary Amperex Technology Co. Ltd. (CATL) about supplying cells for the Model 3 cars it makes in China.
  • CATL is on course to become the biggest manufacturer of lithium-ion batteries in China.
  • Securing a supply of battery cells in China, the world’s biggest car market, will be key to Tesla’s efforts to open its first plant outside the U.S.

4) Tesla launches new Supercharger with 1,000 mph charging, better efficiency.

  • Newly launched Supercharger is able to deliver a new 250 kW of peak power.
  • New ‘On-Route Battery Warmup’ software feature will intelligently heat the battery to ensure optimal temperature to charge.
  • V3 Supercharging will cut charging times by an average of 50%.

5) The US is a bystander in the global battery arms race for battery raw material.

6) Kia (OTCPK:KIMTF) partners with Amazon (NASDAQ:AMZN) to make EV charger installation simpler

  • The Kia-Amazon partnership makes buying and arranging for installation of a charger as simple as buying anything else online.
  • Shoppers can schedule a professional electrician to wire up the charger too.
  • Goal is to remove one more barrier to adoption of plug-in cars.

7) James Bond to drive electric Aston Martin in new movie.

  • The 25th Bond film will feature the titular character driving an electric Aston Martin Rapide E.
  • Development shows how electric vehicles are becoming more mainstream in people's minds.

8) New York City says electric cars are now the cheapest option for its fleet.

  • The total cost of ownership can be far cheaper for all-electrics compared to gas and hybrid vehicles.
  • Fleet owners focus on lifetime costs (maintenance, fuel, and ancillaries) rather than just the sticker price.
  • EVs, because of their low fuel (electricity) costs and relative simplicity (uncomplicated motors, fewer moving parts) are cheaper, on a relative basis, than their conventional counterparts.

Conclusion:

The planned move towards the nickel-rich NCM 811 lithium-ion battery chemistry is generating more inquiries from battery producers who are trying to secure steady future supplies. Nickel, a metal more known for stainless steel production, is now a highly sought-after battery metal.

Data from China, the largest market for passenger EV battery nickel, shows that the amount of class II battery-grade nickel used for electric vehicle batteries is steadily increasing.

Besides the developments from battery metals production, charging infrastructure technology is also improving in tandem. Companies with skin in the game recognize that current charging times for EV users are still not optimal. We can be sure that Tesla's V3 superchargers will not be the only fast chargers coming online this year.

The electric vehicle market is also making progress with influencing consumers' mindsets towards electric vehicles. The partnership between Kia and Amazon is one example of the industry players taking steps to make the technology closer to consumers. The new Bond movie will no doubt further imprint on millions of movie-goers that EVs have the same or better performance and cool factor than ICE counterparts.

Finally, more data has come out showing that the total cost of ownership of electric vehicles can be far cheaper than gas and hybrid vehicles. This is very promising as cost factors to consumers will eventually determine if we will see continued momentum in the adoption of all-electric vehicles.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.