Electric car enthusiasts often laud automakers for making bold production volume forecasts for electric cars. After all, the more EVs there are the less oil the world will consume.
Even though forecasts vary, all of them agree electric car adoption will grow steadily in the coming decades eventually supplanting the combustion engine.
We often hear about concerns regarding lithium supply, as an essential element of electric car batteries, though most experts believe there is enough lithium on the earth to build at least 2 billion electric cars. And this isn’t including the lithium dissolved in sea-water, which could in theory at least be mined if necessary.
Little discussed, however, is the critical need for rare earth materials, which as its name implies is rare.
Demand for these elements, which occupy in 15 positions on the periodic table, is expect to exceed 40,000 tons annually within a few years. Chief among them is neodymium which is an essential component of electric motors and generators, providing its magnetism. Those motors also require the rare earths terbium and dysprosium which stabilize neodymium’s magnetic properties at high temperature. Another rare earth element, lanthanum, is required in the batteries.
The Toyota Prius, for example, with its relatively small motors and battery compared to all-electrics, uses 2.2 pounds of neodymium and 22 to 33 pounds of lanthanum per car. The Prius, says metals and commodity expert Jack Lifton, is “the biggest user of rare earths of any object in the world.”
“Rare earth availability is a serious problem as the EV market grows, though I’m not seeing much consternation about it yet,” said Mick Crane, the EV and hybrid director of Continental Automotive. “We could be trading dependence on one commodity, foreign oil, for another, rare earth metals.”
China is the world’s largest producer of rare earth materials, and since its own hybrid and electric car production capacity is increasing, will soon be the largest consumer. The country is already restricting exports. China is believed to have 95% of the earths’ supply of these element. The US imported 91% of its rare earth material from China between 2002 and 2008.
The looming shortage has Toyota scrambling for more sources including interest in locations in Canada and Vietnam. A promising rare earth location exists in California, which is slated to reopen in 2012.
Another significant future source is, of all places, Afghanistan which is among the world poorest countries. Afghanistan has recently been determined and reported to contain up to a trillion dollars in mineral resources which includes lithium as well. This report led to an internal Pentagon memo stating Afghanistan could turn out to be “the Saudi Arabia of lithium.”
“There is stunning potential here,” Gen. David H. Petraeus, commander of the United States Central Command, said of Afghanistan in an interview. “There are a lot of ifs, of course, but I think potentially it is hugely significant.”





