CA - Many Have Already Written Off The EV But We Do Not Believe That Read Is Correct
2024-07-24 22:45:00 ET
Summary
- Lithium prices have continued to sell off, with lithium hydroxide and carbonate in China down.
- While many have already written off the EV, the primary driver of lithium consumption via the needed batteries, we do not believe that read is correct.
- If consumers in the US wish to be the last ICE holdouts 25 or 30 years from now, so be it: that will not meaningfully change lithium's larger demand story.
The following segment was excerpted from this fund letter.
No Massif Capital letter would be complete without examining something that is not working or that we got wrong. Thus far this year, the clear winner is our expectation that lithium would make a rebound. Lithium prices have continued to sell off, with lithium hydroxide and carbonate in China down ~10% since the start of the year and the lithium mining sector, as measured by the Global X Lithium ETF, down 18%. The fund's two lithium investments, Lithium Americas (LAC) and Lithium Argentina (LAAC), are down 48% and 46%, respectively....
Many Have Already Written Off The EV But We Do Not Believe That Read Is Correct