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The US has 3 or 4 lithium-ion battery production plants... total! (And Tesla is responsible for that!).
China has 120+ lithium-ion battery plants.
EU has a couple.

Ie China has a MASSIVE lead, in a tech that is crucial to a "level playing field" in EVs.

A week ago, Vice (a YouTube e-zine) produced:
Biden is Facing a Tough Choice on a Electric Vehicle Batteries.
https://youtu.be/_-aWpg-zsLI

In which Vice portrayed Biden as having to essentially give a presidential pardon to SK for stealing tech secrets from LG, or face the loss of 2k-3k jobs in the EV Lithium-ion battery plant, that SK is building in Georgia (US).
The courts have already ruled that SK did indeed, steal the tech from LG.
The VICE piece says SK was threatening to NOT build the battery plant, unless Biden gave SK a "pardon".

Biden was faced with upholding US standards on IP theft, or gaining jobs.

<<South Korean Electric Vehicle Battery Makers Reach $1.8B Deal To End Trade Dispute>>

https://www.npr.org/2021/04/11/986234531/south-korean-electr...

SK agreed to pay $1.8 billion in cash and royalties to LG in the settlement, and both South Korea-based companies agreed not to sue each other for the next 10 years.

The settlement means SK can finish building an EV lithium-ion battery plant in Commerce, Ga., which will provide batteries to Ford and Volkswagen, two contracts it won before the ITC ruling.


So, the US dodged the bullet.

BUT! SK has indicated that they have untrustworthy leadership? Should Georgia and the US "trust" them?

😷
ralph owns a 0.1% SPECULATIVE position in EMH (European Metals Holdings), a HIGHLY RISKY, pre-production, Lithium mine (Cinovec) in the Czech Republic due to the Chinese lead, and the pressure on EU to "catch up".
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feel free to ignore.

probably rates as a thread hijack and discussion on a different board to go further on this specific observation but...

re:
The US has 3 or 4 lithium-ion battery production plants... total! (And Tesla is responsible for that!).
China has 120+ lithium-ion battery plants.
EU has a couple.

Ie China has a MASSIVE lead, in a tech that is crucial to a "level playing field" in EVs.



Really interested in understanding what in the market acted to create this result.
Was it simply a matter of local labor costs?
Or geography and proximity to raw materials?
Was it influenced by enviro policies, tax/investment policies directing rational actors to invest in China factories due to ROE calculus?
Or....?
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A lot of it probably has to do with the fact that many of those 120 factories are making batteries for small consumer devices like ear buds and cell phones. And companies like Apple like to have multiple sources that drive the costs way down. Probably only a few make car batteries.
Note that even though Tesla makes batteries at their gigafactory in Nevada, the tech is from Panasonic.

Mike
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China has 120+ lithium-ion battery plants.
...
China has a MASSIVE lead, in a tech that is crucial to a "level playing field" in EVs.


I am sure there is some great technology among a few of the 120+, but the vast majority are certainly making quick-and-dirty cheap cells, hopefully in smaller quantities that mostly don't make it here.
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Really interested in understanding what in the market acted to create this result.

From NSEnergy:

https://www.nsenergybusiness.com/features/china-lithium-ion-...

The report notes that China’s success has come as a result of its large domestic battery demand, 72 gigawatt-hours (GWh), alongside control over 80% of the world’s raw material refining, 77% of the world’s cell capacity and 60% of the world’s component manufacturing.

For a little more detail on manufacturers:

https://www.grepow.com/blog/top-10-lithium-battery-manufactu...

And an underlying theme is that the industry is/was supported as a strategic industry just as were solar panels. All technology developed in U.S., but users want low price.

KC
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But for what they lack in control over the raw materials supply chain, the nation’s [sic] [Japan and South Korea] make-up for in higher environmental and RII scores compared to China.

The above is significant because it reveals the way the rating is calculated, it's not just output which is how I would rate most industries.

Battery shapes and sizes are almost as numerous as bellybuttons. I wonder what counts higher, innovative startups searching for the holy grail (solid state?), commodity producers (smaller shops), or well funded industrial behemoths (Tesla?) that benefit from scale and integration.

For investing purposes I don't think this is much of an issue.

Denny Schlesinger
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