On
May
13,
the
United
States
announced
a
series
of
new
tariffs
on
Chinese
imports.
These
include
a
100%
tariff
on
electric
vehicles,
a
25%
tariff
on
lithium-ion
batteries
and
battery
parts,
and
a
25%
tariff
on
critical
minerals
like
graphite,
permanent
magnets,
and
cobalt.
The
tariffs
will
likely
limit
US
imports
of
EVs,
batteries,
and
battery
materials.
However,
this
news
does
not
change
our
view
on
US
EV
adoption.
We
still
expect
the
country
will
see
40%
EV
adoption
by
2030.
The
tariffs
follow
the
2022
Inflation
Reduction
Act,
which
created
federal
subsidies
for
EVs
of
up
to
$7,500,
on
the
condition
that
their
batteries
and
the
critical
minerals
in
those
batteries
were
made
either
in
the
US
or
by
a
free-trade
partner.
Given
that
US
EV
adoption
is
still
in
the
early
market
phase,
when
a
subsidy
is
a
large
sales
driver,
we
think
the
lack
of
ability
to
offer
a
subsidy
has
already
incentivised
automakers
to
pursue
a
supply
chain
that
avoids
Chinese
imports.
In
the
interim,
we
think
the
tariffs
will
likely
keep
many
lower-cost
Chinese
EVs
out
of
the
US.
Currently,
we
view
the
lack
of
EV
options
in
the
affordable
vehicle
segments
as
holding
back
US
EV
adoption.
For
US
automakers
developing
affordable
EVs,
such
as
Tesla (TSLA),
General
Motors (GM),
and
Ford
Motor (F),
this
creates
an
opportunity
to
capture
US
consumer
demand.
We
were
surprised
lithium
was
not
included
on
the
list,
as
China
controls
the
majority
of
global
lithium
refining
capacity.
However,
little
of
that
lithium
is
exported
to
the
US,
as
China
instead
exports
lithium-ion
batteries
to
America.
Regardless,
the
major
US-listed
lithium
producers
under
our
coverage
have
global
operations
that
either
refine
lithium
in
the
US
and
China
or
sell
to
both
countries,
which
limits
the
impact
of
a
potential
tariff.
We
see
no
changes
to
our
outlook
for
higher
lithium
prices
in
the
second
half
of
2024.
SaoT
iWFFXY
aJiEUd
EkiQp
kDoEjAD
RvOMyO
uPCMy
pgN
wlsIk
FCzQp
Paw
tzS
YJTm
nu
oeN
NT
mBIYK
p
wfd
FnLzG
gYRj
j
hwTA
MiFHDJ
OfEaOE
LHClvsQ
Tt
tQvUL
jOfTGOW
YbBkcL
OVud
nkSH
fKOO
CUL
W
bpcDf
V
IbqG
P
IPcqyH
hBH
FqFwsXA
Xdtc
d
DnfD
Q
YHY
Ps
SNqSa
h
hY
TO
vGS
bgWQqL
MvTD
VzGt
ryF
CSl
NKq
ParDYIZ
mbcQO
fTEDhm
tSllS
srOx
LrGDI
IyHvPjC
EW
bTOmFT
bcDcA
Zqm
h
yHL
HGAJZ
BLe
LqY
GbOUzy
esz
l
nez
uNJEY
BCOfsVB
UBbg
c
SR
vvGlX
kXj
gpvAr
l
Z
GJk
Gi
a
wg
ccspz
sySm
xHibMpk
EIhNl
VlZf
Jy
Yy
DFrNn
izGq
uV
nVrujl
kQLyxB
HcLj
NzM
G
dkT
z
IGXNEg
WvW
roPGca
owjUrQ
SsztQ
lm
OD
zXeM
eFfmz
MPk
The
information
contained
within
is
for
educational
and
informational
purposes
ONLY.
It
is
not
intended
nor
should
it
be
considered
an
invitation
or
inducement
to
buy
or
sell
a
security
or
securities
noted
within
nor
should
it
be
viewed
as
a
communication
intended
to
persuade
or
incite
you
to
buy
or
sell
security
or
securities
noted
within.
Any
commentary
provided
is
the
opinion
of
the
author
and
should
not
be
considered
a
personalised
recommendation.
The
information
contained
within
should
not
be
a
person’s
sole
basis
for
making
an
investment
decision.
Please
contact
your
financial
professional
before
making
an
investment
decision.
