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Electric vehicle developers and entrepreneurs are on track to produce far more battery plants, known as gigafactories, than the EV industry is projected to need this decade. Like the boom in railroads in the late nineteenth century and in low-orbit satellites in the 1990s, the gigafactory fever may be headed for a bust.
The gigafactory glut is a small part of a giant looming crisis in the supply chain that’s handling the roughly 150 million EVs expected to be on the road globally by 2030: While the world has too many proposed battery factories, it paradoxically hasn’t planned to produce enough of the raw metal ore and processed feedstock to supply those facilities.
As a result, the 2020s seem likely to run into a severe battery shortage. By 2030, automakers will be unable to immediately fulfill up to 35 million expected EV orders, because there will be no batteries to propel them—similar to today’s semiconductor crisis (scroll down to see the math behind that forecast).
This production malaise will not strike all automakers equally: Chinese automakers will have the advantage because China possesses most of the world’s processing capacity for battery metals. Silicon Valley EV startups without the resources to establish their own local supply relationships are ...