AUS
NZ
UK
CA
USA
IND
Highlights
- Automakers, investment companies and others are investing in green lithium technology amid rising EV adoption
- Direct lithium extraction is expected to boost lithium supply to meet the demand
There has been a growing trend in investing in greener lithium technology among several automakers, oil giants, investors and others recently in order to meet the rising demand for lithium.
Direct lithium extraction (DLE) companies use less land and groundwater compared to other forms of lithium extractions. While DLE uses a more eco-friendly and green technology for lithium production, some experts believe commercial scale production of this technology can be available by the end of this decade.
Lithium metal is a key component used in electric vehicle (EV) batteries. Stellantis NV (LON:0QXR), a global automotive company, had signed a lithium supply agreement with California and Germany based DLE companies earlier this year.
Also, auto giant BMW announced its investment in DLE firm Lilac Solutions, just a few days ago for producing lithium in a more energy efficient manner. Billionaire Bill Gates’ energy firm Breakthrough Energy Ventures has also backed Lilac solutions to help boost the energy efficiency of lithium powered EVs
Oil giant Schlumberger also recently announced that it is building a DLE project in Nevada, US.
Global lithium demand stood at around 320,000 tonnes in 2020 and is forecasted to reach up to 1 million tonnes by 2025 and 3 million tonnes by 2030. However, sufficient supply of the metal is one of the key bottlenecks that EVs are facing, thus, DLE technology can help bolster lithium supply.
In view of this, let us look at 2 FTSE listed EV focused stocks in the auto and financial services sector and how they reacted to the development:
- Aston Martin Lagonda Global Holdings PLC (LON: AML)
FTSE 250 index listed company Aston Martin is a British luxury car maker. The company’s DB6 model was unveiled on Thursday as a remastered electric vehicle variant by specialist car design firm Lunaz.
Aston Martin recently reported its H1 2021 revenues rose by 242 per cent to £ 498.8 million, compared to £ 146.0 million in H1 2020.
(Image source: EODHD/Others)
Aston Martin’s shares were trading at GBX 1,762.00, up by 4.54 per cent on 8 October 2021 at 11:29 AM BST. Meanwhile, the FTSE 250 index was at 22,575.02, up by 0.07 per cent.
The company has a market cap of £1,958.71 million, and its one-year return stood at 76.54 per cent as of 8 October.
- Scottish Mortgage Investment Trust PLC (LON: SMT)
FTSE 100 index listed company the Scottish Mortgage Investment Trust is an investment company that was an early backer of EV giant Tesla (LON:0R0X) amongst other EV firms.
The trust’s managers have recently turned towards EVs in China and other areas as the next investment opportunity. SMT’s cumulative par net asset value (NAV) was at 1313.42 pence per share as of 6 October.
The trust was among one of the best performing trusts in 2020, as per financial research site Morningstar.
(Image source: EODHD/Others)
Scottish Mortgage Investment Trust’s shares were trading at GBX 1,384.50, down by 0.40 per cent on 8 October 2021 at 11:46 AM BST. Meanwhile, the FTSE 100 index was at 7,081.39, up by 0.05 per cent.
The company has a market cap of £ 19,640.69 million, and its one-year return stands at 37.76 per cent as of 8 October.
