President Donald Trump’s recent decision to revoke electric vehicle (EV) targets set by former President Joe Biden may slow demand for critical minerals like lithium in the short term, but analysts and industry leaders believe it won’t significantly impact the mining sector due to surging global EV demand.
Key Highlights:
Policy Change:
Trump rescinded Biden’s 2021 executive order aiming for 50% of new vehicle sales in the U.S. to be electric by 2030, a move that has already affected shares of automakers and lithium miners.
Market Resilience:
Despite a potential cooling of EV demand in the U.S., experts assert that growth in other markets, especially China, will offset any slowdown.
China dominates the EV market, accounting for 65% of global sales, while North America represents about 20%.
Global Transition:
The transition to EVs is seen as inevitable, with Australian lithium producer Liontown Resources emphasizing that global demand will continue to rise regardless of U.S. policy changes.
CEO Antonino Ottaviano stated, “Longer term, I just don’t think it will be an issue on demand.”
Growing Global Market:
The rest of the world is already witnessing significant growth in EV sales, with a 27% year-on-year increase, expected to surpass the North American market within two years.
Critical Minerals Demand:
The demand for critical metals extends beyond EVs, as they are essential for grid-scale batteries, consumer electronics, and AI-powered technologies.
David Klanecky, CEO of Cirba Solutions, anticipates a spike in U.S. demand for critical minerals by 2030 due to a broader range of electronics.
Supply Chain Independence:
Executives believe that efforts to reduce reliance on Chinese supplies will have a more substantial impact on the mining industry than the rollback of EV sales targets.
Darryl Cuzzubbo, CEO of Arafura, noted, “We expect measures taken to build supply chain independence from China… to have a much greater impact.”
Industry Outlook:
Rio Tinto’s CEO, Jakob Stausholm, expressed confidence in lithium’s future, predicting demand could increase fivefold over the next 15 years. He emphasized the superiority of EVs over traditional combustion engines.