A recent report released by?Benchmark?Minonal?Intelligence?a specialist information provider for the lithium-ion battery industry, revealed that a slowdown in supply chain logistics across the lithium-ion battery supply chain as a result of the outbreak of New Crown Pneumonia has jeopardized production and use across the globe.
A supply glut in the lithium battery industry?2019?has delayed the emergence of the current lithium battery supply crunch, according to?Benchmark? However, due to transportation restrictions and logistics lags, global buyers are concerned about whether suppliers can meet the supply. At the same time, due to the limitations of the current production capacity of the major factories, the procurement volume is not much, but once the demand surge or will trigger the risk of supply shortage.
Australia, a major producer of lithium, has asked members of the Association of Mining and Exploration Companies to pay strict attention to intercontinental travel restrictions. In South America, Chile has imposed a national ban, parts of Santiago are under quarantine, and Argentina has imposed a nationwide quarantine; in Africa, cobalt supplies are facing disruption due to the closure of South Africa's borders and ports, as well as a quarantine imposed by Congo, a producer of the raw material cobalt.
As a result, global logistics and supply will be tightened, and major EV makers may have to source components nearby to minimize risk. For those automakers that don't have the capacity to produce batteries, the risk is that their profit margins will shrink further due to rising costs.
This article comes from the authors of AutoNation, and does not represent the views of AutoNation.