One chart & a few points on Lithium, Tesla, and BYD.
Note the #Lithium price chart below and its correlation with Tesla $TSLA & BYD (HK:1211) shares, the two biggest EV makers in the world (by vehicle sales).
It's all about supply and demand. Right?
1. The #Lithium carbonate price is down 56% YTD, on fears that demand will grind lower, as China's economy is growing much slower than expected. Concerns about the tiger economy are getting louder.
2. China's lithium-ion battery demand is slowing. And, there are short to medium-term lithium oversupply concerns.
3. China's Jiangxi plans to build a $1.4 billion solid-state battery plant in Ganzhou.
4. Consider that BYD (HK:1211) makes 78% of its revenue from China. Tesla's $TSLA makes 22% of its revenue from China. Nio $NIO makes 100% of its revenue from China (According to Bloomberg).
5. But the long-term picture has NOT changed. The green transition is only beginning. EVs are expected to grow from ~24% to 45% of passenger car sales in China by 2025 (Bloomberg).
This is general in nature and does not take into account your objectives, situations, or needs. Consider the appropriateness of this information in light of your circumstances before making investment decisions.
