Growth of Electric Vehicles Might Only Go as Far as the Sustained Development of New Battery Metal Sources

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With pressure on global automakers to meet increasingly aggressive measures to move car owners from fossil fuels to clean decarbonization targets, electric vehicle (EV) investment is growing exponentially. 

According to a new report from Thomson Reuters Corp. TRI, automakers worldwide will spend more than $500 billion on EVs and batteries through 2030. The report credits looming zero-carbon mandates in cities such as London and Paris and countries from Norway to China.  

The chase is on for auto companies to keep pace with Tesla Inc. TSLA, which produced more than 300,000 electric vehicles in Q4 2021 alone. And while automakers such as Volkswagen AG VWAGY recently announced an investment of more than $100 billion on developing a line of EVs in the next five years, others are playing catch up. For example, the top five selling models in 2021 manufactured by Toyota Motor Corp. TM, the new number one seller in the United States, were all gas-powered models.  

But with more charging stations being built and improvements in battery technology and pricing, EV sales may continue to see a steep rise, with one caveat – according to some, there’s not enough metal to create the batteries needed to fuel that growth. That shortage of essential raw materials has brought global competition from companies developing new and increasing lithium, nickel, cobalt, and graphite deposits.    

The good news is that batteries are continuing to evolve, with the average battery energy density rising at 7% per year and new chemistries hitting the market at an increasingly rapid pace. Charging speeds, a big detractor for many, are getting increasingly faster with maximum rates rising.

The raw material facing the most significant growth in demand as companies continue to look to new battery technology is graphite. Once only used for auto brake linings, gaskets, and clutches, graphite is fundamental to EV battery chemistry, and there are no substitutes. 

That expected rise puts companies like Montreal-based Nouveau Monde Graphite, Inc. NMG NOU at the front of the necessary metals needed to continue to meet EV battery demands. In response, the company is developing a fully integrated source of carbon-neutral battery anode material in Québec, Canada, for lithium-ion and fuel cell markets. 

Focusing on low-cost operations and strict environmental, social, and governance (ESG) standards, Nouveau Monde’s goals include the lofty and what they believe to be the reachable pursuit of becoming a key strategic supplier to the world’s leading battery and automobile manufacturers. 

“As electrification becomes mainstream and ESG principles dominate asset managers’ and investors’ consideration, Nouveau Monde has stepped up as a recognized contributor to the decarbonization effort. 2021 was a structural year as we lined the building blocks that will support the next stage of our development,” Nouveau Monde Chairman Arne H. Frandsen said.  

Demand to Outweigh Supply

Predictions highlight that graphite demand will exceed the global supply by 400,000 tonnes by 2026, however, with Nouveau Monde’s plan to begin commercial production by 2024, it expects to be the largest producer in North America to help offset this imbalance. 

Nouveau Monde believes it is positioning itself as a turn-key, local supply of carbon-neutral anode material to cater to the growing North American and European battery and EV markets.

To learn more about Nouveau Monde Graphite, Inc., go to www.nmg.com.

This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.