- Penny predicts a dramatic shift in commodity demand patterns as the electrification of the global economy continues to boost demand for the metals that Norilsk produces, particularly nickel and cobalt
- Penny noted that hybrid battery vehicles in the United States currently account for 9% of the market, with annual growth of 18%; battery EVs have around 3% market share but growth of 25%
- Fuel cell EVs represent just 1% of the market but are growing at an annual pace of 41%
Andrea Hotter
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NEW YORK — Norilsk Nickel chairman Gareth Penny gave his predictions for electric and hybrid vehicle growth and how the company will move to maximize the value of its products in an interview with Andrea Hotter in the April 2018 issue of Metal Market Magazine.
Penny predicts a dramatic shift in commodity demand patterns as the electrification of the global economy continues to boost demand for the metals that Norilsk produces, particularly nickel and cobalt.
“Like most of these things, the move to [electric vehicles] will take longer than people think, but when the time arrives it’ll be even more dramatic,†he said.
Penny noted that hybrid battery vehicles in the United States currently account for 9% of the market, with annual growth of 18%; battery EVs have around 3% market share but growth of 25%. Fuel cell EVs represent just 1% of the market but are growing at an annual pace of 41%.
Although Norilsk is synonymous with nickel production, roughly 27% of the company’s revenue actually comes from the metal compared with 30% from palladium. With around 8% of Norilsk’s revenue coming from platinum, more than one-third of its earnings come from platinum group metals.
Penny remains unperturbed about the potential loss of demand for palladium – his top commodity pick currently despite his self-confessed love for diamonds – due to the elimination of catalytic converters as the world electrifies its cars. This is largely because he expects the biggest absolute growth in the next 10 years to be in hybrid vehicles.
“You cannot make a diesel engine a hybrid as you need a very light engine, which is by definition a petrol engine. Palladium is the catalytic converter of choice for petrol engines, while platinum is for diesel,†he said. “We are confident that in the next 10 years, demand for palladium in hybrid vehicles is going to grow very rapidly and probably outstrip the absolute growth of battery and fuel cell EVs.â€
Norilsk might even get involved in new areas of the battery production chain, Penny said, with a joint venture its likely method of entry.
“Norilsk will definitely look at some form of partnership at different levels in the industry in order to maximize the value of its product. That’s something we’re actively considering at the moment,†he said. “I don’t know about developing batteries, but we’re looking very carefully at working with European chemical company BASF, with whom we’ve had relationships before.â€
Source: http://www.amm.com/Article/3798827/Nonferrous/Move-to-EVs-to-be-dramatic-for-metals-Penny.html
