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Half of all new cars sold in Australia by 2035 will be electric, forecast predicts – Guardian
New government analysis on electric vehicles suggests Labor’s election policy was not out of step with path country is already on
Half the new cars sold in Australia in 2035 will be electric vehicles even if there is no policy support to drive change, a new government analysis forecasts.
It will reinforce the expert view that Labor’s election pledge to set a target of 50% new car sales being electric by 2030 would not have been that significant a shift from a path the country is already on.
Labor’s commitment prompted the prime minister, Scott Morrison, to accuse the opposition of wanting to “end the weekend” by forcing people out of four-wheel drives and the minister for small business, Michaelia Cash, to tell tradies only the Coalition would “save their utes”.
The government has said it will introduce a national electric vehicle strategy to cut carbon dioxide emissions by 10m tonnes by 2030, but is yet to release details.
A report published by the government’s Bureau of Infrastructure, Transport and Regional Economies examines the uptake of electric vehicles in 22 countries. It found sales vary between nations but are expected to grow rapidly across the world in coming decades.
Modelling suggests the electric vehicle share of new car sales in Australia will rise from about 0.34% today to 8% in 2025. It is predicted to then leap to 27% of new car sales in 2030 and 50% in 2035 as prices of electric car technology fall.
Behyad Jafari, chief executive of industry group the Electric Vehicle Council, said the report showed the transition to electric vehicles would happen “no matter what” and Australia would not need to do much to accelerate a local industry.
“As this report shows, the destination for Australia is predetermined. The choice is how much value and benefit we capture in getting there,” he said.
“Globally, there is some $US300bn being invested in the EV sector. Surely Australia should be getting a piece of the action.”
The report says battery cost is expected to more than halve by 2025 and continue to decline, but battery size and vehicle range would both increase to more than double by mid next decade before peaking.
“This means that the outlook is for a fairly constant battery price for EVs out to 2025, before the price starts to decline,” the report says. It says a similar trajectory is expected for other manufacturing related costs.
The infrastructure and transport department said the report set out what would be expected under existing policy settings and did not assume any additional government support, but noted some government agencies invested in electric vehicle infrastructure.
A department spokeswoman said electric car uptake in Australia was slow compared with some of the countries examined. She said there would be a rapid change in new car sales once the technology became price competitive, but it would take some time for that to be fully reflected on Australian roads.
“There is usually a 10 to 15-year lag between new vehicle sales numbers and overall fleet numbers, so EVs are not expected to be a significant part of the passenger vehicle fleet until well into the 2030s,” the spokeswoman said.
The latest report is separate to government modelling discussed in Senate estimates in April. Environment department officials said they also had data prepared by consulting firm Energeia that suggested electric cars would account for 25-50% of new sales by 2030.
The government has committed $400,000 to develop its national electric vehicle strategy. It is expected next year.
Treasurer Josh Frydenberg last year compared the expected trajectory of EVs to that of the iPhone. He said changes in battery technology and recharging infrastructure were gaining momentum in Europe, Asia and North America and would inevitably be replicated in Australia, and predicted people who mocked EVs would one day be driving them.
Lithium Market Cheers as Top Supplier Sees Demand Driving Higher
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Albemarle calms concerns about oversupply, weak Chinese demand
- Albemarle reported better-than-expected quarterly results
Albemarle’s 2019 outlook helps calm investor fears of lower lithium prices from an oversupplied market, James Sheehan, an analyst at Suntrust Robinson Humphrey, said in a note. A 4 percent gain in prices in the fourth quarter, “supports our thesis that Albemarle can maintain stable pricing.”
Albemarle’s stock rose as much as 11 percent, the biggest intraday gain since May 2016. It was the best performer on the S&P 500 Index on Thursday. Santiago-based Soc. Quimica y Minera de Chile SA, the world’s second-largest producer, rose 2.4 percent for a second consecutive gain. Shares of Tianqi Lithium Corp., the third-largest, posted their highest closing price this year.
Concentrated Market – Three companies control over half of lithium supply
Charlotte, North Carolina-based Albemarle, which produces about a third of the world’s lithium, expects prices to remain flat or to increase this year. Prices for lithium carbonate, the most common form of the mineral, have fallen from historic highs, but still remain more than double the level of four years ago, according to monthly data by Benchmark Mineral Intelligence.
Global sales of electric vehicles soared 98 percent during the fourth quarter, Albemarle Chief Financial Officer Scott Tozier said Thursday on a conference call with analysts. The number of available plug-in hybrids and battery-electric models announced by automakers for 2021 has grown by almost 40 percent since mid-2017. As a result, demand for lithium carbonate equivalent will be about 475,000 tons by 2021 and 1 million tons by 2025, he said.
Large producers such as Albemarle, SQM and Tianqi will continue to dominate a space that might look oversupplied this year as new capacity comes in, Albemarle Chief Executive Officer Luke Kissam told analysts during the call. With new technologies demanding more lithium, the market will remain tight in coming years, he said.
“The momentum around electric vehicles has continued to accelerate,” Tozier said. “The demand curve has shifted higher and steepened,” he said, referring to lithium.