COVID-19 Puts Global E-Vehicle Market at Risk

Rare earths and other materials used in e-vehicles and high-tech equipment are undersupplied. The coronavirus pandemic has halted efforts to produce them, especially in major economies like China and the US.

Since COVID-19 reached countries outside China, US junior minors have slowed their engineering work, environmental reviews, and loan applications. Companies like Piedmont, Lithium Americas Coup and ioneer Ltd already said they’re facing setbacks halting mine construction.

These materials were considered risky against American strategic minerals that have large cash reserves, lowering demand. 

No employee of any company mentioned above tested positive of the coronavirus. Nevertheless, the pandemic sparked caution to some executives.

Seth Goldstein, a minerals analyst at Morningstar, claims the delay could reach a year or two. 

In the short term, the prediction will help China. MP Materials, which runs the only American rare earths mine, now relies on China for final processing. 

China’s Manufacturing Industry

Meanwhile, China’s slowing economic growth is affecting much of the manufacturing industry. Particularly, in its green energy sector, including renewable energy, battery energy storage, and, that’s right – e-vehicles. 

China is one of the top manufacturers of renewable investments. The country is expanding its portfolio on green-friendly products and services to lessen carbon emissions.

Products like battery prices have decreased over time, due to more people buying these vehicles around the world. Now, the pandemic is expected to crush these prices even more.

Battery production, which is obviously an important part of e-vehicle production, is slowing down across different manufacturing players. Two of China’s biggest manufacturing firms CATL and BYD are now, more than ever, likely to delay production.

Tesla’s Gigafactory in Shanghai is also giving signs of supply shortages for exports to the US, UK, and Australia. 

These shortages and delays will hit battery manufacturing companies, especially those in critical areas. Because of this, the coronavirus is expected to lower Chinese battery outputs by around 26GWh this year.

The world is slowly healing from much less petrol cars and pollutants outside homes. 

China’s factories have been a huge contribution to the world’s pollution but only recently went green. Now that China is the world’s largest e-vehicle market, is this how mother earth ironically strikes back?

So, What’s Tesla Doing?

The e-vehicle manufacturing company is working on something much dissimilar to its forte: ventilators. Tesla CEO Elon Musk said the firm will reopen its New York factory as soon as possible.

Musk’s company is one of the few automakers allowed to make such devices. Ford is also looking forward to reopening some of its factories in early April to help build them.

In context, respiratory problems driven by the coronavirus requires assistance of ventilators to help patients breathe. Increasing cases of the coronavirus, the US is experiencing a shortage of these devices. 

Due to increasing coronavirus cases in the country, the US is experiencing a substantial shortage of these devices. So, the US Congress is pushing companies to make as many as they could. 

Companies like Tesla plan to make at least 200,000 ventilators by the end of this year.