Electric cars could get a lot cheaper, and there’s a good reason for that.

lithium. This is the element that in recent years has come to be called white gold. The price of this important component of the battery industry has increased until 2022. However, something surprising has happened that may mean that your electric car can stop being just a dream and materialize very soon!

The price of electric cars is falling
Many people do not have an electric car because it is still expensive to buy a car in this new segment.  One of the factors that contributes to the high prices of electric cars is the value of the battery, as lithium is the main component.
According to pricing agency Benchmark Minerals, Since January, the price of lithium has fallen by about 20%..  The sharp decline occurred at a time when electric vehicle sales are growing.  a Cobalt, another key material in many batteries, has been more than halved.  The price of copper, which is needed for electric motors and batteries, fell 18%.  And all this at a time when demand is surging and new mines in places like the US and Peru are being pushed into action.
Even these sudden price changes confused many analysts who predicted that prices would remain high or even rise this year, delaying the energy transition in transportation, but also in renewable energies.
Instead, lower prices for raw materials have made it easier for automakers to lower the prices of their electrical products, or to increase profit margins.
One of the first moves came in early January, when Tesla cut prices on the Model 3 and Model Y EVs, and later did the same for the Model S and Model X.
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in some cases, These discounts exceed 10%.sparking a price war which, as we can see, also has another major role to play in bringing component costs down.
Experts say that prices Components such as lithium may continue to decline due to factors such as weak demand than expected in Europe and China, where changes to support programs slowed sales somewhat at the start of the year.

But other industry voices said the decline could be due to the start-up of new mines and plants, which increased supply and thus lowered prices.
The point is that even after such a sharp price drop, lithium prices remain so high that mining and processing the metal is a very profitable business.  Metal suitable for batteries costs between $5,000 and $8,000 per ton. It sells for 10 times that amount.  By the way, Elon Musk said that even if it is a kind of "money printing machine".
Given these huge profit margins, investors are eager to invest their money in mining and processing projects.  Even governments are offering large sums of money for new lithium projects, which on paper should lead to increased production and lower prices.
However, other experts warn that the opposite may be true.  According to US government estimates, the Lithium supply should increase 42 times by 2050 To meet the demand of sectors such as electric vehicles and fixed supports.



A sodium battery could be a cheaper alternative
The problem, according to Jose W. Fernandez, Undersecretary for Economic Growth, Energy, and Environment in the State Department, is the handling of that lithium.  The mineral is abundant and large deposits of lithium are being discovered all over the world.  But the Lithium processing is very limited, and it is mainly in the hands of China.
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Most of the lithium refineries are located in China, and only a few companies outside the country know how to build lithium processing plants.  Beijing's near monopoly over an essential resource has alarmed the Biden administration, which has allocated tens of billions of dollars to encourage Western companies to develop lithium mines and refineries in the United States or in countries with which it shares close political and economic ties.  Like Canada or Mexico.
one of The alternatives that are gaining momentum are sodium batteries.  In just a few months, these pools have gone from irrelevance to front page news, and they want to become a more economical and sustainable option.

We have seen an example of the effect of sodium on cobalt.  This controversial material, as mentioned above, also breaks down in terms of price.  This is mainly due to the explosion in demand for lithium iron phosphate (LFP), which did not fail to increase its share of sales, which allowed it to gradually displace Cobalt, affecting its demand and price.
Now it remains to be seen where the price of lithium will fall, which, as we remember, Decreased in 2020, at just $5,600/ton, currently at $44,700/tonFar from its historic highs in 2022, when it reached $88,600 per ton.  Your electric car may soon cease to be a dream.