08 March 2024 | Anthony L. Cheng, Erica R. H. Fuchs, Valerie J. Karplus, Jeremy J. Michalek
This study examines the relationship between electric vehicle (EV) battery chemistry and supply chain disruption vulnerabilities for four critical minerals: lithium, cobalt, nickel, and manganese. The research compares the nickel manganese cobalt (NMC) and lithium iron phosphate (LFP) cathode chemistries by mapping their supply chains, calculating a vulnerability index for each chemistry, and using network flow optimization to bound uncertainties. The findings indicate that both NMC and LFP cathode chemistries are highly vulnerable to disruptions in China, with 80% [71% to 100%] of NMC cathodes and 92% [90% to 93%] of LFP cathodes relying on minerals that pass through China. NMC has additional risks due to concentrations of nickel, cobalt, and manganese in other countries. The combined vulnerability of multiple supply chain stages is significantly higher than at individual steps. The study suggests that reducing risk requires addressing vulnerabilities across the entire battery supply chain, including upstream mining, midstream processing, and downstream manufacturing and recycling. The results highlight the importance of understanding and managing geopolitical and supply chain risks in the context of EV battery production.This study examines the relationship between electric vehicle (EV) battery chemistry and supply chain disruption vulnerabilities for four critical minerals: lithium, cobalt, nickel, and manganese. The research compares the nickel manganese cobalt (NMC) and lithium iron phosphate (LFP) cathode chemistries by mapping their supply chains, calculating a vulnerability index for each chemistry, and using network flow optimization to bound uncertainties. The findings indicate that both NMC and LFP cathode chemistries are highly vulnerable to disruptions in China, with 80% [71% to 100%] of NMC cathodes and 92% [90% to 93%] of LFP cathodes relying on minerals that pass through China. NMC has additional risks due to concentrations of nickel, cobalt, and manganese in other countries. The combined vulnerability of multiple supply chain stages is significantly higher than at individual steps. The study suggests that reducing risk requires addressing vulnerabilities across the entire battery supply chain, including upstream mining, midstream processing, and downstream manufacturing and recycling. The results highlight the importance of understanding and managing geopolitical and supply chain risks in the context of EV battery production.