Lithium Race At IMF: "Electric Cars Can Replace Motor Vehicles In The Next 10 To 25 Years."

Now IMF joins top financial institutions with its own very bold prediction: "Electric Cars Can Replace Motor Vehicles In The Next 10 To 25 Years." We are talking here about all cars being electric much faster than a lot of people think. Elon Musk with Tesla Model 3 launch is showing that "The Best Affordable Electric Car" is here and its mass production has started. 143 models of electric cars which will be available in the West by 2022 are announced already and there are more than 70 models of electric cars on sale in China now. 

Please note that in IMF's view for the electric cars my forecast of 36 million tonnes of LCE (Lithium Carbonate) to be produced by 2040 is very conservative and must be tripled in order to accommodate this transition to a fully electric fleet of new cars. According to The Economist, in the case of all new cars being electric by 2040, this fleet will count 1.8 Billion electric cars. We are talking here about over 100 million tonnes of LCE being produced by 2040 in order to make it happen. The starting point today is 200,000 tonnes of LCE produced in 2016.

Lithium is the magic metal at the very heart of this Energy rEVolution.  International Lithium is plugged into the very dynamic EVs and Energy Storage markets in China with its holdings in JV projects with Ganfeng Lithium, a giant from China. Finally, some buying volume is coming back into the market of lithium junior miners, investors are getting the message. 

"We are finally moving into the mass market stage for EVs and related news is coming from all over the world. ElecTreck reports that Daimler is now announcing a new $740 million lithium battery factory in China. This project is a part of Daimler's new investments in JV with BAIC to build electric cars in China. Major automakers are not only decisively moving to electric cars like Volvo, but are trying to get a foothold in the largest auto market in the world in China. This announcement comes after we have learned about Tesla's negotiations in Shanghai to establish its own Gigafactory in China.

Electric cars are coming much faster than a lot of people are anticipating it and lithium supply chains will be under pressure from the demand side. There are reports already that lithium battery packs are in short supply and this rising demand for batteries will be driving the demand for lithium raw material supply. We have a total disconnect in the marketplace between exponential growth in EVs and ESS adoption rates and capital available to develop new lithium production. M&A will be an answer for some aggressive market players like Chinese, who are accumulating lithium assets all over the world now. After SQM news we are entering the new phase for the assessment of all M&A opportunities in the lithium sector."

IMF: Riding The Energy Transition - Oil Beyond 2040

We Need 36 Million Tonnes Of Lithium To Be Produced By 2040 For IEA Plan: 600 Million Electric Cars.

International Energy Agency: In Order To Limit Temperature Increase Below 2º C The Number Of Electric Cars Needs To Reach 600 Million By 2040.

"The cost of lithium batteries is going down very fast and I believe that fully electric cars will rule the world very soon. Tesla Model 3 with 65 kWh lithium battery provides over 200 miles of range and will become the standard in the industry with its mass volume production from this July. There is around 60 kg of LCE (Lithium Carbonate Equivalent) in one Tesla Model 3 battery. We will need 36 Million Tonnes of LCE to be produced by 2040 to put this IEA plan into life. 

To put it into perspective, the total lithium production last year was around 200,000 T of LCE. Now you can better understand why there is the real cut throat competition for the security of lithium supply which is still hidden from the most of the people by the clouds of toxic cancer hazard fumes emitted by all DIEsel cars on our roads. ICE (Internal Combustion Engines) are on the way out, all cars will be electric very soon and we are facing the total disconnect between the coming demand for lithium and the available supply. Read more."

IMF Blog:

Chart of the Week: Electric Takeover in Transportation

By IMFBlog

July 31, 2017 

An electric car recharges at a meter in London: The UK is the latest country to announce plans to end fossil fuel vehicle sales by 2040 (photo: Sasha Fox Walters/iStock by Getty Images)

The switch from horses to automobiles in the 20^th century paved the way for the rise of oil-based transportation and energy use. Today, electric vehicle ownership is picking up speed. Greater affordability of electric vehicles will likely steer us away from our current sources of energy for transportation, and toward more environmentally friendly technology. And that can happen sooner than you think.

Our Chart of the Week from a recent IMF working paper shows that the transition away from motor vehicles could happen in the next 10 to 25 years, based on parallel shifts in the 20^th century. Patterns observed in the early days of the horse-car transition closely resemble present-day electric vehicle adoption rates. Between 2011 and 2015, the average annual growth rate of electric vehicle ownership was 120 percent. This is, in fact, slightly faster growth than that of motor vehicles during a comparable timeframe in the past. Using the horse-car parallel, the paper forecasts that by 2040 motor vehicles could mostly disappear in advanced economies, and could comprise about a third of the fleet of all cars in emerging market and developing economies.

Even as Tesla spearheads the transition to electric vehicles, the auto industry is also focusing greater attention on electric vehicles and rapidly increasing the number of models offered, including SUVs. As recently as last month, Volvo announced that it will produce only electric or plug-in hybrids as early as 2019.

Meanwhile, many countries are running with the idea. Both the UK and France are aiming to phase out diesel and gas vehicles by 2040. China has become the largest market for electric vehicles, and India recently announced ambitious plans to get millions of electric vehicles on the road by 2030. Every month seems to bring news confirming a global shift in transportation technology.

But the switch to electric cars has deep implications for the auto industry, climate change, and the oil market.

The auto industry must shift gears to deal with potential disruption. Electric cars take fewer parts to produce, and require less maintenance than motor vehicles. Therefore, investment in people is critical—whether job training or reskilling programs—to enable workers in both advanced and emerging market economies to work with new technologies, such as self-driving cars and in industries such as battery production.

At the same time, the environmental benefits could be huge, leading to reduced emissions over time, and helping achieve the climate change goals of the Paris accord. What this means is that policymakers and businesses must anticipate the potential consequences of the rise of electric cars and start implementing the right policies for a smooth ride.

Stay tuned for a forthcoming blog on the implications for the oil market."