Recently, Brazil's Vale signed a long-term contract with Tesla to guarantee the supply of nickel products.
In the past few years of the electrification process of the automotive industry, it has experienced the epidemic and the shortage of cores, and now it is necessary to face the shortage of core components batteries. From the price increase of electric vehicles at the beginning of this year, the most intuitive feeling is the impact of the shortage of battery raw materials on new energy vehicles.
A power battery accounts for most of the cost of a new energy vehicle, but now, the next preparation for automobile manufacturers is the shortage of metal raw materials required for batteries. It is easy to understand why automakers are now seizing the resources of metal raw materials.
So, who is now capable of grabbing this wave of resources?
Battery raw materials, who is grabbing resources?
Now car companies include suppliers, in addition to the resources that have been scarce, lithium, which has always been scarce, the recent nickel element is also regarded as a resource that must be grabbed.
Lithium is the key raw material for new energy vehicle batteries, it is the lightest metal, but also the lowest density of solid elements, which means that lithium batteries can have a higher power-to-weight ratio, that is, in the current and the same weight of other batteries than other batteries, lithium battery energy density can do better. But the price of lithium has been rising in recent years, from $4,450/ton in 2016 to $78,000/ton in 2022.
In addition, nickel has also become more scarce after the escalation of the situation in Russia and Ukraine, reaching the highest price of nickel in 20 years after March this year, 100,000 US dollars / ton. Cobalt elements, graphite and other materials are also competed for resources.
In the absence of raw materials, what can be done to solve this problem? Powerful automobile manufacturing enterprises have laid out the industrial chain to the battery field to ensure that the overall production will not be affected by the core components and raw materials.
In the field of raw materials on power batteries, Tesla, the earliest and most extensive company with the earliest layout, is definitely the first echelon. In recent years, Tesla has laid out three raw material industries of lithium, nickel and cobalt from China, Australia, the United States, France, Canada, Brazil and other countries. The supply period from 2021 to 2024 and even 2027 is mostly long-term contracts, and the supply is very large.
In March this year, after Tesla signed an agreement with An Australian supplier for the supply of 110,000 tons of lithium ore, Tesla snapped up the wind direction into nickel resources. This has a lot to do with its development direction, and the 4680 battery that will be used in the future is a high-nickel battery. Therefore, there is also the news that Tesla purchased nickel resources at the beginning of the article, in fact, tesla signed a large order for 4 nickel suppliers last year.
Why start grabbing nickel resources? High-nickel batteries have become a development trend in the power battery industry, which means that the development direction of the entire industry needs a lot of nickel to support, with nickel can have a higher energy density battery, better endurance, stronger products, but the price to pay early with low prices to get nickel resources or high-priced acquisitions.
Tesla is taking the self-developed + outsourcing two parallel lines, purchasing lithium iron phosphate + ternary lithium, and self-developing is a high-nickel 4680 battery. These products correspond to long cycle life (energy storage, low-end products using lithium iron phosphate), high endurance (corresponding to ternary lithium battery models), high-nickel batteries (focus on high-performance products, pickup trucks and other high-end models).
In addition to Tesla, GM, Toyota, Ford, Volkswagen and other companies are also laying out their own resource industries. Volkswagen Group ordered a $64 billion lithium battery order last year, but for such a global company and a group with many brands, ordering batteries from battery suppliers is a solution, but this solution is not enough insurance.
The Volkswagen Group needs its own power batteries to ensure the supply of products in the future new energy era, and the six battery factories in Europe also indicate that they need more raw material security. The 10-year supply of lithium/lithium ore with Ganfeng Lithium and 5 years from Australian suppliers is just part of it.
Back to reality, does grabbing resources have an impact on us?
It is necessary to understand a real problem, most of China's lithium, nickel and other elements are still dependent on imports. The superficial meaning we see is that all parties are competing for resources, and the direct impact of grabbing raw material resources in the battery industry is to keep the low price of the whole vehicle.
With the ability to grab resources, not only on the one hand, it is necessary to have sufficient production capacity and downstream channels, in addition to the domestic Ningde era, Ganfeng Lithium and other battery suppliers, BYD may be one of the few enterprises with the above capabilities.
There is the ability to develop core components, the ability to produce batteries, and the purchase of battery orders by downstream car companies, so that the value of battery raw materials purchased can be maximized; on the contrary, the new forces of car manufacturing rarely mention the layout of the upstream battery industry, and when the self-research, production capacity and downstream channels are not mature, it does not make much sense to grab it, and it is not in line with the development goals at this stage.
In the case of high external resource prices and insufficient internal resources, there is no possibility of power battery recycling industry. From 2020 onwards, the concept of battery recycling has emerged, and it is expected that 120,000-170,000 tons of power batteries will be scrapped every year; but the difficulty of recycling and reuse is difficult, and it is very difficult to recover high value-added parts such as positive electrode, anode material, electrolyte and separator in the scrapped lithium battery, and it is more difficult to commercialize, and the lithium battery formulas of different manufacturers are also different.
In short, the battery recycling road is much more difficult than spending money to grab resources, and it may be costly to invest in battery recycling and finally may not be as cost-effective as directly buying raw materials that year. After all, where are the downstream channels for the output after recycling? Who will choose? These are all places where the battery recycling channel is immature.
It begs a question, car companies and suppliers are grabbing resources, is it good for us to buy a car?
This problem stems from the collective price adjustment of new energy vehicles this year, and the price increase is thousands to tens of thousands of yuan, which is directly related to the consumer's car purchase budget. Then after domestic suppliers and car companies have grabbed overseas mineral resources, some people may think that these resources can calm the price of electric vehicles at this stage; this idea is feasible, but it may need to be calculated in years.
In the early stage of the development of China's power battery industry, it has experienced a period of leading enterprises to expand production against the trend, widening the difference in competition and amplifying the dislocation of supply and demand relations, so the power battery that has been there has reduced costs, but now it is the price of raw materials that has risen, which makes downstream enterprises so uncomfortable.
summary
Since last year, the overall growth rate of the battery industry has been pulled away by leading enterprises, small battery manufacturers have gradually fallen behind, it is not easy to buy materials this year, the possibility of buying cheap materials is basically zero, so the current power battery supply can only rely on the products of several large enterprises.
Now capable car companies need to do no longer just the ability of self-developed batteries, but have to learn from companies such as BYD and Tesla, learn the ability to expand upstream, and lay out the raw materials with relatively low prices at this stage in advance.