Electric vehicles (EVs) are more technology than vehicles, with automakers and battery producer urged to remain agile to keep pace with the rapid technology changes.
"The electric vehicle battery life cycle is a major factor that has to be recognised. Once battery makers have developed a new chemical solution for batteries, they don't want to switch, so they have to be sure they are going the right way," McKinsey Basic Material Institute senior analyst Ken Hoffman told a battery metals conference in Perth, Western Australia.
Battery producers have already seen a change in raw material preference to lithium hydroxide from lithium carbonate and to hard rock lithium from lithium brine. While the nickel manganese cobalt (NMC) 622 battery is currently the main preference for EV batteries, this is expected to shift to NMC811 by 2022.
There has been a deliberate move towards reducing cobalt input, because of price and supply sensitivities, and increasing nickel input.
"The next move after that could be to solid state batteries for electric vehicles with lithium anodes," Hoffman said. "This would see lithium's content in batteries switching to anodes from cathodes. Anodes are currently dominated by either natural or synthetic graphite."
"I've never seen a market where demand went up by 60pc but prices dropped by 40-50pc," Hoffman said about lithium prices.
Lithium-ion batteries are more nickel batteries than lithium batteries, said the chief executive of Clean Teq Holdings Sam Riggall, whose company is developing the Sunrise nickel-cobalt-scandium project in Australia's New South Wales.
"The world needs to build two to three Sunrise projects every year for the next decade to meet demand. Nickel has some difficult supply hurdles to overcome," he said.
One of best ways to improve EV performance is through making vehicles lighter, rather than only focusing on the battery, Riggall said. Scandium can play an important role in making aluminium lighter.
"There is no doubt that the world's automakers are committed to an electric future. Globally there are 70 mega factories under construction for the making of EV batteries, 46 of which are in China. In October 2017, there were only 17 under construction around the world," Riggall said, adding that consumers have demonstrated that they are prepared to "jump directly into fully electric vehicles, leaving out hybrids".
