Automakers Demand for Lithium to Rise 17% in 2017
Lithium is the critical component of the lithium-ion batteries that power smartphones, laptops, and cars. Global demand for lithium batteries is expected to reach 1.7 billion units in 2016 and rise 17% to 2 billion units in 2017.
U.S. automakers like General Motors Co. (NYSE: GM) and Tesla Motors Inc. (NASDAQ: TSLA) that make the Chevy Bolt and Model S and Model X, respectively, use significant amounts of lithium in their car batteries. The world’s largest lithium miner is Chile’s Chemical & Mining Co. of Chile Inc. (NYSE: SQM) but Tesla is also securing mining claims in the U.S. to produce its own lithium.
Demand would have been stronger in the second half of this year, according to EnergyTrend, were it not for the Chinese government’s decision to delay subsidy payments to domestic automakers who build all types of electric vehicles (xEVs). The government has been trying to end excessive subsidy payments the carmakers.
Duff Lu, research manager at EnergyTrend, said:
China has become a major xEV battery market. As the share of xEVs in the country’s passenger vehicle market expands, demand for cylindrical lithium cells will also grow.
The delay is expected to be temporary and EnergyTrend expects a pickup in demand next year in the automobile market. In the laptop battery market demand is expected to reach 440 million units this year according to EnergyTrend.