The CEO of Rivian believes that the battery supply chain will be the next catastrophe.
This will make the chip scarcity seem like a minor annoyance.
Key Highlights
- In an interview with the Wall Street Journal, the EV chief stated, "Semiconductors are a small taste of the pain we are about to suffer in the next two decades with battery cells.
- Scaringe believes that the compressed schedule for transitioning millions of personal vehicle sales from internal combustion engines to battery-electric vehicles will expose a lack of preparedness throughout the battery supply chain, from mining to final pack production.
- At the moment, "90% to 95% of the supply chain does not exist" to meet the expectations set by governments and OEMs for the next decade.
- To achieve such percentages, lithium-ion battery demand has increased by an average of 37% annually since 2015, with the Journal predicting a 50% increase this year.
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A year ago, car industry executives felt we would be emerging from the tempest of skyrocketing vehicle costs, the chip shortage, and the supply chain problem, and we would begin to feel the welcoming warmth of normalcy. Life threw as much water on those assumptions as Mother Nature did recently in New England, when she dumped enough rain and snow (in the middle of April!) to knock out thousands of people's electricity.
Recently, the outlook has deteriorated, and Rivian CEO R.J. Scaringe has delivered the worst news yet. In an interview with the Wall Street Journal, the EV chief stated, "Semiconductors are a small taste of the pain we are about to suffer in the next two decades with battery cells."
Scaringe believes that the compressed schedule for transitioning millions of personal vehicle sales from internal combustion engines to battery-electric vehicles will expose a lack of preparedness throughout the battery supply chain, from mining to final pack production.
At the moment, "90% to 95% of the supply chain does not exist" to meet the expectations set by governments and OEMs for the next decade. In the United States, hybrid vehicles accounted for 5% of total car sales last year, while electric vehicles accounted for 3%, both records. To achieve such percentages, lithium-ion battery demand has increased by an average of 37% annually since 2015, with the Journal predicting a 50% increase this year.
No segment of the battery industry, and we're not sure the Earth, can sustain that. Lithium has earned the moniker "white gold," with the pursuit of it driving developments that could become what fracking is to oil for minerals, sparking outrage among climate activists and prompting statements such as "A lot of us understand that blowing up a mountain for coal mining is wrong; I believe that blowing up a mountain for lithium mining is just as wrong."
Wouldn't it be ironic if history books recorded that humanity hastened its push into space in order to locate the minerals necessary to save the Earth? (Do not fear; it is on its way.) We're not sure if canaries are the preferred bird in lithium mines, but have a look at Scaringe's Wall Street Journal op-ed.