In its presentation to the World Economic Forum in January 2023, Toyota Chief Gill Pratt attempted to justify the diversion on hybrid vehicles over fully electric vehicles.
“We need to minimize carbon as much as possible as soon as possible,” Pratt said. He then showed a prediction on the supply risk of the lithium demand.
“There won’t be enough lithium. So what do we do?” he said.
Pratt said that we have to electrify vehicles as much as possible.
“Our thesis, and Toyota is not alone in this, but I think we’re sort of the thought leader in this, is that we should electrify vehicles as much as possible but we don’t have to electrify them only one way.
“The one way that you’re most familiar with is the pure battery electric vehicle, that’s the one that plugs in and then drives purely on batteries. But it turns out that uses a lot of lithium.
“The other one, which is called a plug-in hybrid vehicle, has an engine on board that can recharge the batteries while the car is driving beyond a certain range. Then finally, the hybrid vehicle, which is all the technology, uses gasoline but a much more highly efficient range.
“All of these use lithium but they use them in different amounts”
The Toyota chief then proceeded to discuss how distributing lithium across 100 hybrids is better than putting that lithium all into one vehicle, this is based on the assumption that there is only enough lithium available to supply 1% of vehicles.
“We have 100 vehicles that are traditional, so these are internal combustion cars and we want to replace these,” Pratt said.
Pratt then showed a comparison of distributing a lithium resource of just 100 kWh between either a single fully electric vehicle or 100 plug-in hybrid vehicles.
“If we use 100 kWh worth of batteries we can replace one of these 100 vehicles, the one you see in blue,” he said.
“So the average of the emissions that we see here has dropped only a bit. Now, if we use the same 100 kWh and spread it amongst 6 vehicles, in this case these are plug-in hybrid electric vehicles. Because they plug-in and they have the gas engine for going further range, they have smaller batteries.
“So we can distribute that same amount of batteries over 6 vehicles instead rather than one. And it turns out that even though each one of them emits a little bit more than the pure battery electric vehicle the fleet average because we’ve replaced 6 instead of one is actually better.”
Pratt added that in the case of a hybrid car, it puts out 200g/km so it is not nearly as good but twice as bad as the BEV but Toyota is replacing 90 of them because the batteries are smaller.
Lithium constraint assumption
The Toyota Chief’s January 2023 presentation is based on the assumption that there is only 100 kWh of lithium battery supply for every 100 vehicles produced.
As per TheDriven, around 75 million cars were sold globally in 2022, including almost 100 million fully electric vehicles.
The EV sales amount to 13% of total vehicle production, disproving Pratt’s claim that lithium constraints meant only 1% of vehicles could be fully electric.
Dutch energy analyst Auke Hoekstra responded by stating that Toyota’s claims are “utter bollox.”
Lithium supply surpassing EV battery demand
During the presentation, Pratt showed a graph entitled ‘Lithium deficit is expected to grow.’ The graph suggested that lithium demand from EV batteries will be well above supply by 2040.
“You’ll notice there’s this incredible gap,” Pratt said, indicating the forecast supply shortage.
“The International Energy Administration actually has this gap even bigger at 50%,” he said.
Pratt’s forecast that lithium supply will be constrained for the next 15 years suggests that lithium carbonate prices should be through the roof. However, what is happening is quite the opposite.
Since Toyota Chief Gill Pratt showed his presentation last year, the Lithium Carbonate price has plummeted. Thanks to the increase in global supply.
According to a study from the International Council on Clean Transport (ICCT), lithium supply will surpass demand well into the next decade. The study also found that the US has the potential to secure a lithium supply, outstripping demand by 3 to one. This further accelerates battery cost reductions and fully electric vehicle prices.
