Rising Demand Of Electric Vehicles - Is This Good For Lithium Investors?

  • Nov 22, 2018 AEDT
  • Team Kalkine
Rising Demand Of Electric Vehicles - Is This Good For Lithium Investors?

It is expected that the sales of electric vehicles will experience significant growth in next few years as metal prices are stabilizing and many Countries are also putting in policies and reforms to promote the sales of Electric Vehicles.

Due to this reason, investors are gaining more confidence in Lithium Stocks, and they have started to put in money in Lithium stocks as they want to reap the benefits from the increased Electric Vehicles Sales.  With the increase in the demand of Electric Vehicles, there will be an increase in the battery metals demands. Which is the reason why Lithium Stocks are looking very attractive to many investors. As per the recent market news, it has been forecasted that by the year 2025 around 400,000 tonnes a year of lithium will be needed for the Electric vehicle. As per some Analysts, the lithium prices are expected to fall back slightly in the year 2019. However, it is expected that the prices will increase towards the end of 2019 and beyond to support significant new supply. Some analyst believes that Investors don’t understand the lithium supply chain which is why until now the Lithium stocks were taking a beating. 

Recently, there have been many big announcements related to the Electric Vehicles due to which the investors are now having more confidence in the battery metal stocks. Volkswagen Group recently announced that it is going to devote over $68.5bn in the upcoming five years to support Electric vehicles. This big step of Volkswagen will be very dependent on Asian batteries. German Battery Maker Varta has made an announcement regarding the future mass production of Electric vehicle batteries which will reduce the dependence of German Automakers on Asian Batteries.

Even Small caps which are dealing in nickel and copper are gaining the attention of investment banks and other big investors. In the recently held International Mining and Resources Conference in Melbourne, IBK Capital Corp Senior Vice President Ms. Miranda Werstiuk said that the Investment Bank is paying close attention to nickel and copper as both the metals are very much needed in electric vehicles. Further, EU emissions targets have put in additional pressure on Automakers to prepare their vehicles for the low-emissions scenario of future.

China and Europe are witnessing a substantial rise in demand for Electric Vehicles. In the first half of 2018, the total sales of electric vehicles in Europe increased by 40%. Currently, there are more than 1 million electric cars in Europe, and it is expected that by the year 2030 Electric cars will gain around 50% market share in Western Europe. Currently, in the United States, the electric vehicle demand is not as exciting as compare to the other countries like China and Europe. The main reason behind this the low gasoline price in the US and the lack of government policies.


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