High Voltage: An Aussie EV called The Yewt is coming to city near you
Link copied to
Each week our High Voltage column wraps all the news driving ASX battery metals stocks with exposure to lithium, cobalt, graphite, manganese and vanadium.
Volkswagen is struggling to source enough batteries to drive its (extremely) ambitious EV ramp up. Now, it looks like a major supply deal with Samsung SDI could fall though.
According to Bloomberg, Samsung was going to deliver 20GWh of lithium-ion batteries — enough to power 200,000 cars with 100KWh packs. Now that deal is under threat.
“VW ultimately needs 300 gigawatt hours of annual battery cell supply and without robust global multi-sourcing contracts this will be impossible,” Evercore ISI analyst Arndt Ellinghorst says.
“It’s one thing talking up electric vehicle volume numbers, building the necessary value chain remains a major challenge.”
@Volkswagen is running into battery supply problems before the first ID.3 even leaves the production line. Bloomberg reports it is renegotiating a €50 billion battery purchasing deal with Samsung SDI after the original pledged supply of 20GWh was cut to 5GWh.
— Greg Kable (@GregKable) May 27, 2019
EV disruption could have prompted a ‘survival of the fittest’ merger of two of Europe’s biggest carmakers, Fiat Chrysler and Renault.
The cost-saving 50-50 merger plan could create the world’s third-largest automaker, selling an estimated 8.7 million vehicles a year.
And who said Australia wasn’t ready to embrace EVs?
Toyota Australia says the RAV4 SUV hybrid has easily outsold the petrol counterpart since hitting the Australian market in early May. And an Australian electric vehicle maker (yes, you read that right) has signed a deal to produce four EVs — the Cargo, Yewt, Urban and the Sportz.
The Australian Clean Energy Electric Vehicle Group (ACE-EV) aims to produce more than 15,000 vehicles by 2025.
“We’re taking 100 orders for vehicles for the first tranche, by the end of 2019 the books will be closed and they’ll be built in the first quarter of next year,” ACE-EV boss Greg McGarvie says.
“As we progress, and the appetite looks like it’s there… we’ll go to full manufacturing.”
Of the companies on our list, 79 lost ground, 62 were ahead and 50 were steady this week.
Advanced cobalt-nickel play Australian Mines (ASX:AUZ), which is currently finalising a detailed long form off-take agreement with battery maker SK Innovation — was up 32 per cent for the week to 2.5c on no news. As were fellow cobalt explorers Broken Hill Prospecting (ASX:BPL) and Celsius Resources (ASX:CLA).
Are cobalt stocks bouncing back?
Rare earths play Arafura (AWX:ARU) was up 26 per cent, also on no news – but there’s no mystery to be solved here.
Speculation that China may ban rare earths exports to the US saw investors flock to ASX-listed rare earths players last week.
China President Xi Jinping visited the JL MAG Rare-Earth factory, which manufactures magnetic rare earth elements, in Ganzhou. The inference is that Xi might be about to ban the export of rare earths to the US to “cripple” its opponent’s tech and military industries.
Either way — with consumption of rare earths in the EV sector forecast to grow by 4 to 5 per cent a year over the next decade, questions remain over the ability to meet the industry’s rapidly increasing demands.
Here’s a table of ASX battery metal stocks with exposure to lithium, cobalt, graphite, manganese and vanadium>>>
Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop: