Automakers Are Moving To LFP Batteries – What Does This Mean For The Industry?

Lithium iron phosphate (LFP) batteries are gaining traction in the electric vehicle industry, both in the United States and globally. These batteries offer a lower-cost alternative to the nickel cobalt manganese cells commonly used in electric vehicles. These batteries are different from other compositions, such as lithium-ion, due to the unique properties of iron phosphate as the cathode material.

Recognizing the potential of LFP technology, major companies worldwide have pledged over $11 billion to establish future manufacturing facilities for LFP batteries in the United States. Large companies like Tesla TSLA and Rivian RIVN that have a history of electrification are investing in LFP battery production. Unlike some other compositions that may contain cobalt, nickel, or manganese, lithium iron phosphate batteries are cobalt-free and possess a lower environmental impact.
Ford F has also announced its intention to incorporate LFPs into various models, including the popular Mustang Mach-E, beginning this year. To support this initiative, Ford plans to establish a new production plant specifically dedicated to LFP battery manufacturing in Michigan by 2026. This significant milestone would make Ford the first automaker in the United States to have its own LFP battery facility.

However, analysts caution that many battery suppliers and automakers may not be adequately securing their supply of the 'p' in LFPs – phosphate – potentially leaving them susceptible to supply risk in the long run. This exposure to risk highlights the need for more investment in LFP technology and the broader battery supply chain to ensure a secure and sustainable production of electric vehicles through stable access to necessary materials For example, earlier this year General Motors GM invested $650 million in a lithium company to help support its battery production for electric vehicles, but did not make a similar investment in phosphate. It seems likely companies not currently investing in phosphate may look for a reliable phosphate supply in the future.

Arianne Phosphate Inc. DRRSF is a promising phosphate mining company located in Quebec, Canada. The company’s Lac à Paul project is a response to the growing global demand for phosphate, which is increasing by 2% to 3% each year in terms of agricultural demand and will be considerably higher when LFP batteries are taken into account. The Lac à Paul project is a fully permitted, shovel-ready project.

Arianne’s is a world-class mining site and is the single largest greenfield deposit of phosphate. One major edge Arianne has is that the deposit is igneous which allows it to produce a concentrate higher than 90% of the world’s phosphate, which is housed in sedimentary rock. This allows Arianne to produce a high-purity and low-contaminant phosphate concentrate ideal for use in batteries and fertilizer.

But beyond quality phosphate, Arianne also boasts strong community support and adheres to stricter environmental, social and governance standards. For North American companies that want their suppliers to align with their agendas, Arianne is a perfect partner. 

The growing interest from large companies highlights the increasing importance of LFP batteries in the electric vehicle industry. The reliability and suitability of LFP technology make it an attractive choice for powering electric cars, leading to their wider adoption and supporting the global transition towards sustainable transportation – and Arianne Phosphate seems well-positioned to be a reliable phosphate supplier for companies that are ramping up LFP battery production.

Featured photo by myenergi on Unsplash.

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