Peak Battery Update - Tesla Warns Of Shortage and It's Not Alone

First off, if you are judging the success of EVs just by sales numbers alone, you are missing the point. Electric drivetrains are essentially the only new automotive technology of the last 120 years in cars, which have almost exclusively been using ordinary internal combustion, fossil fuel engines. So expecting sales numbers that rival traditional best sellers like the Ford F150 and Silverado, is surprising. Especially with such big profits being made today by the oil industry. So it was a real accomplishment to have the Tesla Model 3 sell in competitive numbers in it's first year of production. Unlike BEV superfans, the realistic evolution of EVs will see it's biggest impact as more and more mainstream cars are released with counterpart hybrid models, and you can see that trend emerging with Toyota, who offers many of their models in a hybrid version as well. Also more large manufacturers like Hyundai and Honda will offer more plug in hybrids, and finally several big automakers like VW will offer more than double the BEV models that are being produced today. The quiet gigantic player in this EV game of course is China, who controls over 80% of rare earth elements, and is trying to buy up massive quantities of Cobalt (from the Congo and Russia) and lithium. China has considerable domestic incentives to promote BEVs, and the world's biggest market with a population of over a billion people. They sold over 1.25 MILLION new energy vehicles in 2018 (BEVs and PHEVs). At the least they are simply trying to secure their own supply of needed battery materials, and at the worst they are trying to control the world market. But I have to say that even though Tesla is correct in openly stating the issue with cobalt supply, they do have an inside agenda at play here as well. Their current Model 3 (Panasonic) batteries have a much lower cobalt content than their competition, and most importantly for this discussion, the new dry electrode Maxwell batteries that Tesla owns the patents and rights to build, do NOT use cobalt at all, plus they are easier and cheaper to build, are more reliable, and have potentially up to double the energy density of existing automotive lithium batteries. So this cobalt shortage announcement could well be the precursor to Tesla's subsequent unveiling of their next generation batteries, which have the potential to give them a great advantage over other manufacturers, and because of their vertical integration model, they would have far less reliance on world market economies and suppliers than their competition overall. But I have always said that competition breeds innovation. And as the EV market is likely to at least double in the next 3-5 years, other automakers will have to similarly innovate to remain competitive.

If EV production is limited by the availability of battery capacity, it would seem natural to concentrate on plugin hybrids (like Chevy Volt) over pure EVs. With a much smaller battery (18.4 kwhr in the Volt), one could make about five volts for every Tesla with a 90 kwhr battery. Yet the Volt provides a high percentage of EV miles for the typical user.