Tesla Just Hit a Major Roadblock
I’ve been spending a lot of time talking about the problem with batteries that’s holding back the electric vehicle (EV) revolution.
And I’ve even clued you into a company that has developed the technology to fix all those problems.
But the lack of a reliable battery to power the cars isn’t the only roadblock standing in the way of an electric future…
In fact, there are several other hurdles the EV industry still needs to leap before it can achieve the lofty goals set for it.
And when I say that, I mean, if we don’t figure out these problems, electric vehicles are never going to be anything more than a passing fancy.
The first one is the batteries. And you already know why those aren’t cutting the mustard. They’re huge and heavy and expensive, but they don’t pack very much power and they’re prone to explosion.
But there are two other major obstacles the EV industry needs to overcome, even after this company’s batteries are powering all the EVs on the road and in the sales lots.
You Want to Make How Many?
Let’s start with the most glaring one: materials. EVs and regular cars use a lot of of the same materials, but in very different amounts.
First, there are the batteries. Even the newest generation of them — pioneered by this company — need lithium to function.
They don’t need quite as much as the older versions, but they still need it. And they’ll need a whole lot of it if all the cars on the road are going to be electric.
That’s a lot of cars. And if we’re going by the timelines set by state and national governments, there’s not much time.
Take California, for example. It’s just one state. And its governor says it’ll ban the sale of new gas-powered vehicles by 2035. That may sound far away, but it’s going to come very quickly.
And just for reference, Californians buy about 2 million new cars a year and there’s about 22 pounds of lithium in the average EV battery.
That means it’ll take about 44 MILLION pounds of lithium to make batteries for a year’s worth of new cars for California. That calculates out to about 20,000 metric tons of the stuff.
In 2020, the entire world produced about 82,000 metric tons of lithium. So just to electrify all the new cars in California in one year, it would take 25% of the world’s lithium production.
Now, California isn’t the only place promising to ban cars powered by fossil fuels. Canada, France, Spain, Taiwan, India, China… They’re all proposing bans on new gas-powered vehicles.
All told, there are 31 countries that have plans to go all-in on EVs. Canadians buy about 1.7 million new cars a year. The Chinese buy about 20 million a year. Spain registers about a million new cars a year.
Just take those three countries and you’ve got around 23 million EVs to power… PER YEAR.
That’s about 230,000 tons of lithium. Add in California and you need more lithium for one year’s worth of new batteries than the entire global lithium industry produces in three years.
This company’s new battery design will help because it will require less lithium per car. But it’s not going to solve the problem.
The only thing that can do that is an operation that uncovers new lithium deposits.
Your Pennies Just Got More Valuable
But lithium isn’t the only metal we don’t have enough of to do what we say we’ll do. Another one that’s just as integral to EVs is probably jangling around in your pocket right now with "Honest Abe’s" face on it.
Obviously, I’m talking about the copper on your pennies.
Did you know that an average EV has about a mile of copper wiring running through it? It’s used to make literally every major component in the car.
That’s around 3½ times as much copper as a gas-powered car uses. And the difference increases as the vehicle gets bigger.
While an internal combustion vehicle has about 22 kilograms of copper, a fully electric vehicle has about 80 kilos. And an electric bus… it’s got a whopping 253 kilograms of copper keeping it going.
So let’s just go with regular EVs for these calculations:
A battery EV has about 80 kg of copper. California wants to get about 2 million of those out a year. That’s 160 million kg of copper for one year’s worth of cars for Californians.
That’s 160,000 metric tons, or eight times the amount of copper produced by miners around the world each year.
So for California — just one state out of 50 — to go all electric (and just with new cars), we’ll need to allocate eight years’ worth of copper production to them.
Sorry, rest of the world. Californians need to drive EVs, so you get no copper for a decade while they build up a year’s supply.
How do you think that one will fly at the next G-7 summit or at the U.N.? My guess is not so well.
But that’s the hard and brutal truth that the politician and zealots are completely ignoring.
We simply do not have the resources to meet those goals.
Not unless someone can find more lithium and copper fast.
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You Can’t Double-Dip the Chip
Those are old problems, though. Those of us who’ve been following the industry since inception already knew that.
But there’s a new one that recently popped up. And not only is it hitting the EV industry, but it’s hitting it harder than others.
I’m talking about microchips, or semiconductors. You probably already know there’s a shortage. It’s driving up the prices of used cars and making it really hard to make new ones.
You see, there are as many as 1,400 chips in a typical vehicle today. But EVs require far more than traditional vehicles. And with the shortage still out of control, they just don’t have the parts they need to make the cars.
Now, the automakers and chip suppliers all want us to believe they’ll get back on track soon. But they’ve got to do more than just get back on track.
They’ve got to clear the massive backlog that’s built up over the past year or so. Then they’ve got to catch up so they can make enough to fulfill new orders that are coming in.
And then, on top of all that, they’ve got to figure out a way to double, maybe even triple production, because the cars that are supposed to be getting on the road take far more chips than the ones we’re trying to get off the road.
That’s a pretty tall order for any industry, let alone an industry that’s not even able to keep up now.
Only the best chipmakers out there are going to be able to stand up and deliver.
And if they don’t, I’m afraid the EV revolution will die before it even gets started.
But that’s not something I’m really all that worried about. You see, while I’ve identified these problems, I’ve also found several companies that have identified solutions to them.
I’ve already shared the company that’s making lithium-ion batteries obsolete and putting Elon Musk on the defensive.
And today my partner, Briton Ryle, is going to share the rest. We’re very bullish on the future of the EV industry.
And we’ve identified several companies poised to deliver the solutions the EV industry needs in order to really take off.
We’ve found a copper miner with deposits right next door to some of the biggest battery plants in the world.
We’ve identified a lithium explorer that may have hit the mother lode.
We’ve even found a company that can meet the soaring demand EVs will drive in the semiconductor space.
And we’ve put all of them into a presentation that details the issues and how these companies are solving them.
All you’ve got to do is click here to give it a watch and then get yourself invested alongside us.
Then you’ll be set up for one of the most monumental profit events in history.
Just make sure you don’t wait too long to see what we’ve got to say. Every day, these companies are getting more and more attention.
Don’t cut yourself out of the biggest part of the gains.
Click here now and learn how to get yourself invested TODAY!
To your wealth,
After graduating Cum Laude in finance and economics, Jason designed and analyzed complex projects for the U.S. Army. He made the jump to the private sector as an investment banking analyst at Morgan Stanley, where he eventually led his own team responsible for billions of dollars in daily trading. Jason left Wall Street to found his own investment office and now shares the strategies he used and the network he built with you. Jason is the founder of Main Street Ventures, a pre-IPO investment newsletter, and co-authors The Wealth Advisory income stock newsletter. He also contributes regularly to Wealth Daily. To learn more about Jason, click here.
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