Modeling potential impact of COVID-19 pandemic on global electric vehicle supply chain

Abstract

The on-going COVID-19 pandemic and consequent lockdowns cast significant impacts on global economy in the short run. Their impact on stability of global electric vehicles (EVs) supply chain and thus our climate ambition in the long run, however, remains hitherto largely unexplored. We aim to address this gap based on an integrated model framework, including assessing supply risks of 17 selected core commodities throughout the EV supply chain and further applying the supply constraints to project future EV sales until 2030. Our model results under three pandemic development scenarios indicate that if the pandemic is effectively contained before 2024, the global EV industry will recover without fundamentally scathed and thus can maintain the same growth trend as in the no-pandemic scenario by 2030. We suggest that fiscal stimulus in the post-pandemic era should be directed more towards upgrading the quality of battery products, rather than expanding the production capacity.

Surging lithium price will not impede the electric vehicle boom

“…Global production capacity of LIBs scheduled by 2025 has exceeded 3.5 terawatt-hour (TWh), a five-time increase from 2021's 0.7 TWh. 5 Suppliers of cathode, anode, electrolyte, separator, and basic chemicals have all overproduced in the attempt to reserve inventory to capture the future market after meeting current demand. In this classic ''bullwhip effect'' scenario, end-use demand elicits inflation of inventory demand at each link of the supply chain, amassing at the uppermost link consisting of mineral suppliers.…”

“…Projected lithium consumption was modeled by the authors. 5 Three lithium consumption scenarios are distinguished based on the market penetration rate of EVs to reflect the uncertainty in the impact of high material prices on EV market growth. The dashed frames indicate differences in lithium consumption among the three scenarios.…”

“…Projected lithium production was collected from public announcements of mining companies. Projected lithium consumption was modeled by the authors 5. Three lithium consumption scenarios are distinguished based on the market penetration rate of EVs to reflect the uncertainty in the impact of high material prices on EV market growth.…”

Exploring the potential for improving material utilization efficiency to secure lithium supply for China's battery supply chain

“…All the flows and stocks throughout the entire lithium anthroposphere life cycle are involved in the system boundary. The spatial boundary is set to be mainland China, which accounts for over 60% of the global lithium chemical production and 70% of the global LIB production [55] . This means that the results of lithium MFA in China could provide valuable insights for improving the material efficiency of the global LIB supply chain.…”

The sustainable development of mobility in the green transition: Renewable energy, local industrial chain, and battery recycling

“…Within sustainable mobility, several countries have applied development plans for electric vehicles (Mallapaty, 2020; Onat et al, 2021). However, to achieve this goal, a certain amount of relevant components and raw materials are required (Baars et al, 2021), among which lithium plays a critical role within the electric vehicle industry (Sun et al, 2022). Some studies have shown that the pandemic has stimulated future demand for electric vehicles (Wen et al, 2021).…”