Many companies are reluctant to invest in critical minerals and energy transition projects due to uncertainty about consumer demand for EVs and government commitment to zero-carbon goals, industry players have said.
The long term picture was intact of a world needing large quantities of materials such as lithium, cobalt and copper to enable the world to give up using fossil fuels.
The timing of the next several years, however, was in question, they told Reuters at the World Materials Forum in Paris last week.
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Both the European Union and 12 US states aimed to ban new petrol car sales by 2035 but there had been a push-back about those targets.
“I think there is a lot of doubt right now that this will happen,” Mathias Miedreich, former CEO of Belgium recycling and battery materials group Umicore, told the conference. “That makes it very difficult to invest.”
In May Miedreich stepped down from Umicore which lowered its 2024 profit forecast the following month due to weak demand projections for battery materials due to a slowing EV market.
Reuters noted sales of new battery electric cars in the EU dropped 12% in May from a year earlier.
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By GlobalData“Financing was not a big issue a few years ago,” said Stephane Michel, president of TotalEnergies’ Gas, Renewables & Power unit. “You can still find capital now, but you have to have the right project.”
Reuters noted TotalEnergies was part of the ACC EV battery joint venture including Stellantis and Mercedes which last month paused plans for German and Italian plants.
An executive with a major European chemicals group that supplies battery materials told Reuters many companies were assuming there would be a delay of about two years in the energy transition with 2030 projections now being moved back to 2032.
“That’s the view now, but it could change and be more serious, it’s hard to say,” the executive told Reuters.
An executive of a global company involved in EV battery materials said demand for critical materials in China and Asia was holding up better than in the Europe and the United States.
“The question is where do we put our next capacity. You have to be very agile, the market is moving very fast,” he told the news agency.
