Critical Materials Impact on EV Adoption

This research bears several limitations. First, the price surge of materials for EV engines and battery systems, including aluminum, copper, ferrum, etc., and materials used for electricity generation, including neodymium, dysprosium, indium, germanium, argentum, tellurium, etc., could also affect the EV adoption^{4 (link),5 (link)}. In addition, if the affordability of critical materials use is not guaranteed, carbon emission reductions in both transportation and the related industries would be held back^{80 (link)}. Further work could expand this analysis to assess how the economic competitiveness of other crucial low-carbon technologies would be affected by the foreseeing surge in the prices of critical materials, how various technologies would compete with each other more strategically, and ultimately how this would influence the realization of climate targets. Second, we do not consider the impact of phosphorus price changes on EV penetration when considering the adoption of LFP batteries given the negligible share of phosphorus in battery cost. However, the surging interest in LFP combined with the rising demand for phosphate from agriculture, the price of phosphorus (and other critical minerals) may move up along a non-stationary path and thus deserves further investigation in future research. Although the price of critical materials is a significant factor affecting the penetration of EVs, we cannot ignore the influence of other factors on the adoption of EVs (e.g., increasing availability and choice in EV models), which should also be paid attention to in future research. Third, it is worth noting that this study does not fully capture price linkages between materials, for example, cobalt prices may decrease with the adoption of low-cobalt batteries and nickel prices may increase accordingly, or lithium prices may increase further with the adoption cobalt-free LFP batteries.