Hybrid Vehicle Adoption: Key Implications For Lithium, Rare Earths, Copper And Aluminum Investors
Portfolio Pulse from Surbhi Jain
The growing adoption of hybrid electric vehicles (HEVs) is set to impact the demand for key raw materials like lithium, rare earths, copper, and aluminum. While lithium and rare earths may see a decline in demand due to lower battery electric vehicle (BEV) sales, copper demand is expected to rise. ETFs such as LIT, BATT, WBAT, and CPER, along with companies like Lithium Americas Corp, Piedmont Lithium Inc, and MP Materials Corp, are directly affected by these shifts.
May 29, 2024 | 6:47 pm
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NEGATIVE IMPACT
The Amplify Lithium & Battery Technology ETF (BATT) may experience volatility due to the shifting demand for lithium and rare earths from hybrid vehicle adoption.
Similar to LIT, BATT is exposed to the lithium and rare earth markets, which are expected to see a decline in demand.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Lithium Americas Corp (LAC) may face challenges due to the projected decline in lithium demand from lower BEV sales, but remains strategically important due to limited domestic supply.
LAC's position as a domestic supplier offers some stability despite the expected decline in lithium demand.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 70
NEGATIVE IMPACT
The Global X Lithium & Battery Tech ETF (LIT) is sensitive to changes in lithium and rare earth market dynamics due to the growing adoption of hybrid electric vehicles.
The demand for lithium and rare earths is projected to decline due to lower BEV sales, which could negatively impact LIT.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
MP Materials Corp (MP) could be affected by the decline in rare earth demand due to lower BEV sales, but its strategic position as a domestic supplier offers potential stability.
MP's strategic importance as a domestic supplier provides some stability despite the expected decline in rare earth demand.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 70
NEGATIVE IMPACT
Piedmont Lithium Inc (PLL) is likely to be impacted by the decline in lithium demand due to lower BEV sales, but its strategic importance as a domestic supplier provides some stability.
PLL's role as a domestic supplier helps mitigate some of the negative impacts from the projected decline in lithium demand.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 70
NEGATIVE IMPACT
The WisdomTree Battery Value Chain and Innovation Fund (WBAT) is likely to be affected by the changing dynamics in the lithium and rare earth markets due to hybrid vehicle adoption.
WBAT's exposure to lithium and rare earths makes it sensitive to the projected decline in demand for these materials.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
The United States Copper Index Fund (CPER) stands to benefit from increased copper demand driven by higher HEV and PHEV sales.
The rise in HEV and PHEV sales is expected to increase copper demand, positively influencing CPER.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 80