Opinion: Will America’s EV revolution be imported from China?

By Michael Graham - InsideSources.com

As senator, Joe Biden was known as “Amtrak Joe.” But as president, his transportation of choice appears to be the electric car.

In his first week in office, Biden said he’d lead the way by pushing to replace the federal government’s entire fleet with electric vehicles (EVs) and promised he’d get there with help from American workers.

Major American companies are with him. Ford said it would invest $22 billion in EVs over the next five years. GM has said it wants to stop making gas-powered vehicles by 2035. Not to mention the historic space in the auto market that Tesla has already carved out for itself.

But while it’s being promoted as a home-grown effort to take the lead on climate, the data show America will import much of its EV revolution from China – ironically, the world’s largest polluter.

Securing America’s Future Energy (SAFE), a group that urges America to look beyond fossil fuels, admits China already owns many critical assets America will need to achieve its EV goals. A recent report warned that if the U.S. doesn’t keep up, “it risks swapping its current reliance on an unstable oil market for its transportation fuels, for dependence on China for its transportation requirements for decades to come.”

According to SAFE, America seems unlikely to escape that fate. China is expected to hold a 57 percent market share in EVs within a decade, not because of superior technology, but rather their control of raw materials.

A recent Financial Times report lays out just how aggressive China has been securing vital elements for the production of EVs, like cobalt. China already controls a majority of the world’s cobalt reserves, and Chinese firms have spent billions buying up mining operations in Africa, home to most of the world’s cobalt supply. China now produces two-thirds of the world’s refined cobalt.

Lithium is another key element used to make batteries, and China controls two-thirds of the lithium output in Chile and Australia, plus about 40 percent of the output in Argentina.

China processes 95 percent of the world’s rare earth materials and produces about 75 percent of rare earth magnets, a component used in EV motors. Of the 142 lithium-ion battery facilities that either exist or are being built, 107 are in China; just nine are in America.

SAFE is calling for the development of its own supply chain that exists outside China, and tax preferences to benefit EV development.

Conor Bernstein, spokesperson for the National Mining Association, says the solution is right beneath America’s feet. “Mineral demand from EVs and other advanced energy technologies is poised to surge. The Biden administration wants a ‘Made in America’ EV future,” says Conor Bernstein, spokesperson for the National Mining Association. “Achieving it has to include ‘Mined in America.’”

So far, there are few signs the Biden administration is ready to take on those commitments. Even worse for the American-branded EV revolution, it’s very likely that Democratic concern over the environment will prevent it from doing what’s needed – namely, digging deep holes in the ground to find our own rare earth materials.

Mark Mills, senior fellow at the Manhattan Institute, told House lawmakers in February that the Department of Defense and Department of Energy have been warning for decades about America’s growing dependence on foreign rare earth materials to no avail.

“In 1954, the U.S. was 100 percent dependent on imports for eight minerals,” he told a House Energy and Commerce subcommittee. “Today, the U.S. is 100 percent reliant on imports for 17 minerals and depends on imports for over 50 percent of 28 widely used minerals. China is a significant source for half of those 28 minerals.”

Mills says the secret to securing an American supply of these materials is simple: America needs to start mining again. But that answer gets more complicated with Democrats in charge of Washington. Biden has already imposed a halt on new oil and gas leases on federal land, and while he hasn’t taken a similar step when it comes to mining, it’s hard to imagine him expanding an activity that has “implications for fuel-cycle carbon dioxide emissions,” as Mills put it.

And if nothing changes, China seems poised to control and profit from our EV vision that Washington will certainly brand as an American achievement.

“Despite vast domestic mineral resources, U.S. mineral import reliance has doubled in the past two decades,” says Bernstein. “Effective U.S. energy policy must include bringing these essential mineral supply chains home. We can either deepen our reliance on China or we can encourage domestic mineral production under world-leading environmental standards that rebuilds our industrial base and provides good, American jobs.

“That,” Bernstein adds, “should be an easy choice.”


By Michael Graham


Michael Graham is Managing Editor at InsideSources.

Michael Graham is Managing Editor at InsideSources.

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