Full Dream Ahead

What’s going on?

Data out on Wednesday showed that more new cars hit Europe’s roads, but we might need to hit the mines stat if we want an electric future.

What does this mean?

Your European road trip may have been slightly busier this summer, since the region rolled 17% more cars onto its tarmac this July than the year before. That would usually signal stable demand and free-flowing cash in the economy. Thing is, carmakers are still playing catch-up with pandemic-stunted supply chains, so this bump is likely just a sign that they’re working through existing order books. But one stat stands out from the rest: drivers bought 62% more electric vehicles this July than last, and because European carmakers prioritized electrified sales during the pandemic, that could be the result of pure, future-focused demand.

Why should I care?

Zooming out: Mine the Earth to save the planet.

Demand for environmentally friendly cars is only useful if we can make enough of them. And right now, BMI – a Fitch research firm – predicts the world’s about to run low on lithium, a key battery metal. That’s no easy fix: it takes at least a decade to get a new lithium mine up and running. You don’t need to be a mathematician, then, to cast a skeptical eye on forecasts of 30-million-a-year electric vehicle sales by 2030.

For markets: Ready, set, grow.

The race between carmakers is on, for sure, but Tesla and BYD are comfortably holding their lead. Research shows the pair had grips on nearly 40% of the global electric passenger car market in the first quarter of 2023, double their share from just two years ago. BYD can thank its Chinese fanbase for its success, while Tesla’s simply riding on its “OG” title.

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Originally Posted August 30, 2023 – Full Dream Ahead