The global auto industry will produce 88.8 million cars and light trucks this year, an almost 6% drop from a year ago, according to researcher IHS Markit, quoted by Bloomberg News.
Electric cars have been a bright spot, but due to a cut in subsidies, China’s automobile manufacturing industry body recently said fewer new energy vehicles (NEVs as they are termed domestically which includes battery-powered and hybrid vehicles) could be sold this year than in 2018. China produces more than half the world’s electric cars and the drop compares to sales growth of more than 60% last year.
A new report by Adamas Intelligence, which tracks the battery capacity of electric vehicles sold around the world, adds another pain point for the industry.
Cobalt has continued to outperform the market due to the rising popularity of cobalt-bearing NCM cathode chemistries in China
The global sales-weighted average passenger EV’s battery capacity, a metric that has risen sharply in recent years, increased by a mere 0.5% in October 2019 versus October 2018 as battery electric vehicles (BEVs) sales have continued to bear the brunt of the market’s slowdown since mid-year.
A bright spot for the mining industry, however, is the fact that the average nickel, cobalt and manganese use per EV battery continues to rise despite weakening market conditions, according to Adamas.
In October 2019, the average EV sold globally contained 22% more nickel, 19% more cobalt and 15% more manganese than the same month last year, helping suppliers offset the broader slowdown in EV sales and average battery capacity growth globally:
Overall, nickel has continued to outperform the market due to the ongoing shift from low-/no-nickel cathode chemistries, such as LFP and NCM 111 [equal parts nickel-cobalt-manganese], to higher-nickel varieties, such as NCM 523, 622, 811, as well as the latest generation of NCA used in the Tesla Model 3.
Additionally, cobalt has continued to outperform the market due to the rising popularity of cobalt-bearing NCM cathode chemistries in China, which continue to glean market share from the once-ubiquitous (and cobalt-devoid) LFP cathode alternative.
And in similar fashion, manganese has continued to outperform the market due to the ongoing shift in China from manganese-devoid (or manganese-minimal) cathode chemistries, such as LFP, to higher-manganese varieties, such as NCM 111, 523, 622 and 811.
