Lithium: heart of the EV’s

Lithium in batteries

Today we are finally talking about the lithium in batteries.
The world’s battery production is heavily dominated by… China. One company, CATL, dominates with more than 35% of the world’s battery production.


CATL also invests in mining to ensure supply of rare earth materials.

Adding up all the chinese battery makers have more than 55% of the global production.

It’s not surprising given that the development has been planned since 2015 as part of their “Made in China 2025” strategy.

battery production

There are huge investments in batteries. More than 13 new battery factories should be created in the US alone in the next 5 years.


Europe is planning to add 35 battery factories before 2035.


But that is only the very end of the supply chain of a battery, a lot of the challenges are with raw materials.


Lithium in numbers

Stellantis is projecting that automakers will face battery shortages. It seems that micro chip shortage was not enough…

Starting in 2024, because of battery production, and again, in 2027, because of raw material shortages.

The main culprit: lithium.


A few numbers to give you some perspective:


  • The total world supply is estimated at 39 million tonnes.
  • Only 13 million tonnes are currently economically recoverable. Meaning: extraction is cheap enough to make some profit. Like oil, if the price goes up: the available supply will as well.


  • Chile has almost 50% of world supplies, Australia comes second with 25%, but they produce 50% of the world’s lithium.
  • The yearly production of lithium is set to be 100 000 tonnes in 2023, or approx. 130 years of production. It was 165 years of production in 2018… They seem to count years of production the same way you spend your salary: the math is correct, but it goes way too fast.
  • The demand for LCE (Lithium Carbonate Equivalent) is rising extremely fast: from 305 000 tonnes in 2020 to 636 000 tonnes in 2022 and 2 million tonnes in 2030.
    FYI, LCE is “only” 18% of pure lithium.
  • A 1kWh battery requires 0.85kg of LCE. A Tesla Model 3 has 50kWh, for 300km range. That is 42kg of LCE per car. They delivered almost one million cars in 2021, so 42 000 tonnes of LCE.
    Ford’s F150 Lightning has a 98kWh in the starter pack and up to 131kWh. Rivian? 181kWh battery.  So… yeah even electric trucks f**ks the environment for no other reason than to show off.


  • China has almost 70% of the world’s lithium refining capacity. They also own mining rights, with the Chinese Tianqi Lithium owning more than 50% of the world’s lithium production. They own stakes in Australia’s and Chile’s mining companies.


  • China also owns 70% of the mining capacity of RDC… where other critical materials for batteries come from.



By the way: we have been focusing this article on lithium, but batteries are only 4% lithium. The rest includes 19% nickel and 6% cobalt.
If Cobalt rings a bell, it’s because when the smartphone industry boomed,  environmentalists raised the alarm about the extraction.
Cobalt is mainly extracted (60% of world production) in the RDC, where children are often forced into labour.
Here is a video about Cobalt in RDC.


But no one cares about that anymore. We need a lot of batteries, real fast.


In the next newsletter, we will discuss the growing business of battery recycling.