As the global auto companies take electrification as the transformation direction, locking the production capacity of key battery materials in the coming decades as soon as possible has become the top priority of the auto industry giants.
General Motors disclosed on Tuesday that it had signed a "multi-year" cobalt supply agreement with mining giant Glencore, although the company did not disclose the size of the raw materials it had locked in.
As a rare metal, the average content of cobalt in the earth's crust is only 0.01%. The main role in the battery is to ensure that the cathode is not easy to overheat or catch fire, which helps to prolong the battery life. Generally speaking, new energy car factories provide an 8-10-year warranty for batteries.
GM said the cobalt locked in the agreement, which comes from Glencore's Murrin Murrin nickel-cobalt mine in Australia, will be used in the positive of its Ultium batteries, which are used in GM electric vehicles such as the Chevrolet Solod, GMC Hummer and Cadillac LYRIQ.
It is clear that electric car batteries need more than cobalt, and GM has signed supply agreements with a number of raw material companies and even built its own joint venture battery plant to ensure that it will be able to produce a million electric cars in North America by the end of 2025.
At present, GM and Posco have decided to set up a joint venture plant in Quebec, Canada to produce cathodic active materials, while signing a purchase agreement for lithium resources with CTR, a California geothermal lithium extraction company, and building an industrial chain for rare earth materials in cooperation with General Electric. It has also locked in the production capacity of alloy sheets and rare earth magnets for MP materials.
It is worth mentioning that while GM is in full swing to lock the production capacity of battery materials, other manufacturers are obviously not idle, especially Tesla, who is regarded as surpassing the goal by GM.
The giant is going all out to find production capacity and even consider digging its own mines.
According to the macro forecast made by Rystad Energy at the end of last year, the global demand for industrial metals for electric vehicles and energy storage batteries will show blowout growth in the next few years. Taking lithium, which is most familiar to Chinese investors, for example, Rystad expects demand to soar 20-fold between 2020 and 2030, as does cobalt and nickel.
As a result, traditional car companies, which often shout the target of producing millions of electric cars a year, have taken the initiative to look for mines.
For example, electric car leader Tesla has successively signed lithium concentrate purchase agreements with Piedmont, Liontown and Core. In terms of nickel reserves, Tesla has also finalized long-term supply agreements for BHP Billiton, Vale, Talon Metals and other mining companies.
The European automobile giant Volkswagen Group has also early finalized the policy of establishing an automotive battery factory and directly purchasing raw materials, and recently signed a memorandum with China's Huayou Cobalt Industry and Qingshan Group to lock in the supply of nickel and cobalt from Asia.
Coupled with the already strong demand for raw materials from battery factories such as Ningde era, LG New Energy and Northvolt, and the increasingly inward rush market, car companies are forced to look for other channels, such as their own investment in mining.
Mr Musk, who welcomed the opening of the Texas plant over the weekend, said on social media that the price of lithium had reached the point of madness and that Tesla might have to enter the field of large-scale mining and refining. The world's richest man also stressed that there is no shortage of lithium in the world at present, but the problem is that the speed of mining and refining can not keep up.
