US President Joe Biden wants to set a goal of 50% electric vehicles by 2030. Although it is a goal in line with what is intended to be done in Europe, this decision involves a series of factors to take into account . The automobile industry will be greatly transformed and the use of new raw materials will be necessary.
In the first place, to achieve this objective, a lithium source large enough to power all the batteries of the cars that it is intended to manufacture is necessary. This problem was already part of the plans of the American country, hence, great progress has already been made in the construction of a mine in the state of Nevada to satisfy all national demand and, thus, not depend on imported product; as already reported by this medium .
Similarly, the US will need batteries, as well as charging points. On the other hand, it will need to increase the production centers, since the vast majority of current factories established in the territory are not suitable for the mass production of electric cars. These investments will require billions of dollars .
Battery manufacturing and assembly centers
Notably, there are only about 2 million electric vehicles on American roads at the moment, according to Barron’s data AND only about 2% of all cars sold in 2020 were fully electric. In addition, General Motors manufactured 1.3 million cars for the US during the first half of the year and only 20,300 were vehicles of this type. In other words, only 1.6% of these vehicles were electric.
As expected, General Motors has already announced an investment of 35,000 million dollars for the manufacture of electric cars between 2020 and 2025. According to the company, the 8,000 million of this budget allocated to the manufacture of batteries will allow manufacturing 1 million vehicles a year.
On the other hand, to produce these cars, adapted plants will be necessary, as well as an investment in maintenance. According to data kept by Barron’s , Ford Motor spends between 5,000 and 7,000 million dollars a year to maintain and upgrade its manufacturing capacity of 5 to 6 million cars.
While Tesla has invested in recent years around 5,000 million dollars to increase its production capacity to 1.5 million cars . That is, it will have to invest about 22,000 million more to be able to reach the capacity that Biden intends to reach.
Installation of charging points
Of the 150,000 electric car service stations across the United States, only a few thousand stations are fast-charging. Users cannot always charge the car at home, nor can they wait hours at a normal service station, so it will be necessary to install thousands of fast charging points .
The fastest charging points cost about $ 100,000 each, according to Arcady Sosinov, CEO of FreeWire, a company dedicated to building these facilities. In addition, this price does not include installation, so to reach 50,000 fast charging stations, for example, it would take around 10 billion dollars .
Stopping at this point, the US would need to invest about $ 100 billion to reach the productive capacity that Biden intends.
Lithium mining industry
As explained before, the North American country will have to reduce its dependence on foreign lithium. However, speaking in global figures, in 2020, the world extracted about 400,000 tons of lithium, enough to make 2 to 3 million electric vehicles a year .
However, it must be borne in mind that only a third of the world’s extraction goes to feeding cars, with the rest going to mobile factories. In other words, the entire planet will have to increase its lithium production by 5 million tons per year, which represents an increase of 13 times the current production .
This means that companies like Albemarle increase their turnover. This corporation spends around $ 900 million a year to maintain and expand its operations, and has a share of approximately 20% of the world market.
In 2030, all this will represent the manufacture of 40 billion lithium battery cells per year for the US, and about 225 billion for the entire world.