Lithium price likely to fall and take battery costs down too
Lithium is one of the more abundant minerals found in the Earth's crust and relative to other metals markets, like copper, it's still fairly small in size, which helps to explain the volatility. Even though global EV (electric vehicle) penetration is expected to rise to 40% by the end of the decade, Matt DeYoe sees an oversupply of lithium in 2024 and 2025, pressuring prices for the metal and providing cost relief for battery suppliers and auto OEMs (original equipment manufacturers) that are working to provide consumers with more affordable EV options. But ultimately we do expect lithium prices to balance out at a fairly high level, relative to history, and the abundance of lithium supply means that, over the next few years, batteries are unlikely to be a constraint when it comes to vehicle availability.
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