Electric vehicle sales are poised to reach new heights in the current year, surpassing all previous records. The surge in EV adoption, as noted by Inside Climate News, has outpaced expectations, fueled by government subsidies and mandates across key markets such as the U.S., China, and Europe.
China, having already exceeded its 2025 targets, stands out as a prime example of this accelerated transition. Analysis by experts at Raymond James reveals that approximately 37% of new cars sold in China are electric, a figure projected to ascend to 45% this year, per the International Energy Agency.
The Rocky Mountain Institute (RMI) echoes these sentiments, predicting that a convergence of falling battery costs, supportive policies, and evolving consumer perceptions could see electric vehicles command over 60% of new vehicle sales worldwide by 2030.
The Bright Revival of Albemarle (ALB)
Having retraced back to triple-bottom support established in early February, Albemarle (NYSE: ALB) is showing signs of a gradual recovery. Currently trading at $130.05, a retest of $142 in the near term seems plausible.
Moreover, ALB recently announced a 40-cent dividend, payable on July 1 to shareholders of record as of June 14. The stabilization of lithium prices further bolsters Albemarle’s prospects. Analysts at Fastmarkets predict a substantial 487% surge in U.S. lithium demand by 2030, potentially sparking a supply squeeze and price surge.
While quarterly earnings have faced headwinds from an 80% plunge in lithium prices due to oversupply, the recent EPS beat and revenue in line with estimates suggest a potential turnaround ahead for Albemarle.
Nio (NIO): A Phoenix Rising from Chinese Subsidies
Nio (NYSE: NIO) is witnessing a robust resurgence driven by Chinese subsidies, painting a bullish picture for this undervalued EV stock. Following a low of $3.61 on April 22, Nio surged to $6 and now hovers around $5.22, presenting an attractive buying opportunity amid accelerating sales.
April saw Nio record a remarkable 134.6% year-over-year delivery growth, with year-to-date deliveries totaling 45,673 vehicles, a 21.2% increase from the previous year. The introduction of the 2024 ET7, a premium smart electric sedan, and plans for two new European models underscore Nio’s promising trajectory.
China’s support for EV purchases, highlighted by incentives up to 10,000 yuan for vehicle replacement and Nio’s planned expansion into the European market, further add to the stock’s allure in the current market climate.
Navigating the Future with Global X Lithium ETF (LIT)
The Global X Lithium ETF (NYSEARCA: LIT) presents a diversified entry point into the lithium sector, encompassing the entire lithium cycle from mining to battery production. Despite facing resistance near $47.25, a retest of $52.50 seems plausible amidst a potential EV sales upswing and stabilizing lithium prices.
With a portfolio that includes key players like Albemarle, Pilbara Minerals, Tesla, BYD Co., Arcadium Lithium, and Pansonic, LIT provides exposure to the burgeoning lithium market poised for exponential growth.
Anticipated surges in green energy demand and electric vehicle sales, coupled with a looming supply-demand mismatch forecasted by the United Nations Conference on Trade and Development, suggest a bright future for lithium prices, potentially catapulting them to unprecedented levels.
*The author of this article, Ian Cooper, holds no positions in the mentioned securities. The views expressed are solely those of the author.