Message: CATL Battry maker
Chinese EV-battery makers hammered by high raw material prices
Chinese electric-car battery makers, including leader Contemporary Amperex Technology Co. Ltd. (CATL), were hammered by surging raw material costs in the first quarter, despite strong sales of electric vehicles (EVs).
In the first quarter, CATL posted 1.5 billion yuan ($221 million) in net profit, sliding 24% year-on-year — its first drop in profits in two years. That came even as revenue surged almost 154% to 48.6 billion yuan.
CATL-BYD battery rivalry altered by Covid and surging material costs.
The above is facts news from China. What can we use it for?
It confirms why I invested in Lac (miner) and not in EV or battery companies. EV companies are out, because it is difficult to find the winners, there are so many to choose from, and the whole structure is complex.
Battery manufacturers could well be a bid, but technologies are shifting, and it's expensive to modified productions, the big wins? I see Lithium will be part of the batteries for many years due to weight in terms of performance, will be hard to avoid?
It also tells that now the high Lithium price is taking hold, that is, the accounts for mines will be significantly better, we have seen that, but not the full effect.
Note that although prices have increased, sales have increased 154%. Part, of course, is price increase, but the raw material cannot be attributed to this large increase at all. Therefore, electrification is well underway even though it is also affected by War, Inflation etc. We want to see really good times for Lithium?
We've got to be in the right segment, whether Lac is the right one I don't know, a lot of you probably know that better. All I can see is a Leadership that is credible and serious. This, along with the US unlikely to sit and watch China put itself on the Lithium market, Tacker must have a good chance and then we see the final approval, we have whole other business case. Remember we have now see from Cauchari, they can build production and have know how from Gangfeng (“ know how” are now also paid).
That Lac has been dragged down along with the general index decline is therefore far from fair, but we should take comfort in the fact that we come back just as quickly and hopefully to a higher level. A lot of other stocks don't. This time I've had the patience and I'm happy about that.
For new investor buy buy…………………….., remember only for money you have.
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