It is important that you know that every hybrid vehicle today mass produced for sale by Toyota, Honda, GM, Ford, and Chrysler utilizes a nickel-metal-hydride (NiMH) battery. Even more importantly you need to know that in the 2007 model year GM made or sold 9,000 ‘hybrid’ vehicles and that all 9,000 were recalled to replace a defective NiMH battery.
In the same year Toyota sold more than 250,000 Priuses and there is no report of any 2007 model year battery failure. Note well that Toyota makes its own NiMH batteries in-house and that GM buys its battery components from a Japanese manufacturer-not Toyota-and has them assembled by the joint venture between Chevron and Energy Conversion Devices, Inc called COBASYS, which has been in existence for most of the twenty-first century, has burned through more than $200 million of Chevron’s money and has never made a profit!
General Motors, Ford, and Chrysler have been forced to try to develop a lithium-ion technology based vehicle for the simple reason that due to mismanagement and short sighted planning they have no way whatsoever to obtain either the critical raw materials for, or NiMH batteries themselves. GM, for example, is only trying to make an expensive niche market lithium-ion plug-in hybrid, because it, through its own shortsightedness, cannot make a Prius fighter based on NiMH technology
Toyota and Honda have clearly decided that a small hybrid vehicle utilizing safe, reliable, long-life NiMH batteries is the bridge to a future mixed fleet of slowly disappearing internal combustion (alone) powered vehicles and vehicles using mixed or pure electric propulsion of some type. This is evidenced by the fact that both companies have now committed to producing substantial volumes of NiMH battery equipped hybrids in the next five years.
For Toyota this will be a ramp up from 1,000 to 3,000 per day of its soon to be enlarged Prius family of vehicles; for Honda this is a commitment to introduce and produce up to 500,000 hybrid vehicles a year by 2011. Both of these manufacturers will have dedicated, in-house battery-manufacturing facilities. In Toyota’s case those facilities will be located only in Japan, so that even when Toyota is finished converting its new assembly plant in Mississippi—from large pickup truck production to Prius assembly—only the sheet metal , interior components, and chassis likely will be produced in North America.
The critical components for the Prius power train, the battery and its management system, will be produced only in Japan. … Unlike OEM, American owned-and-operated automotive assemblers, Japanese OEMs value their in-house developed technology highly and do not just give it away …
Toyota’s current NiMH battery, which is a direct descendant of the original NiMH battery invented by Energy Conversion Devices, Inc., in the 1980s and licensed for manufacturing and use in vehicle propulsion to Toyota in the mid 1990s. It requires at least 12 kg (26 lbs) of the rare-earth metal, lanthanum, per Prius-sized battery. Today’s Prius, utilizing such a battery, has a range of 500 miles on a 10.1 gallon tank of fuel at a top speed (capability) of over 90 miles per hour…Reportedly the next generation Prius, due in 2009, will use a larger NiMH battery to achieve a fuel economy of 71 miles per gallon; it will require a battery made with 20 kg (44 lbs) of lanthanum.
Dudley Kingsnorth, arguably one of, if not , the world’s leading authorities on the fundamentals and end uses of rare earth metals, has corresponded with me on these topics recently, and he has kindly permitted a quote from one of his emails;:
“Until recently lanthanum has been the ‘poor cousin’ of the rare earths – low priced and readily available – so it is probably coming as a shock to many … catalyst producers and the petroleum refiners that they have to think/purchase more than 12 months out if they are to secure sufficient material.â€
…..
“Toyota and Honda may well have a choice – simply put, if they corner the lanthanum market for their batteries (excluding the growing market for rechargeable tools) then there may be none left for …cracking catalysts, i.e. no gasoline to fuel them, so no car sales! So they need to think about the impact of their lanthanum purchases! It is likely that Toyota (who have a large share in the only company in Japan making batteries for hybrid vehicles) have a forward looking purchasing policy and probably have sufficient metal for the next 2 years or so..
The price of lanthanum (La) metal is currently about $13/kg and for the oxide $9/kg, compared with $8.5 and $4.75 at the beginning of the 2008 year and $4.50 and $2 a year ago! Spot prices of $16/kg La2O3 have been quoted in Japan recently, so clearly there is a measure of concern! Toyota has announced that their first lithium-ion battery hybrid will be in production in 2011 and that 1 million hybrids is a target for 2011, whereas two to three years ago they were considering 2-3 million in 2011….â€
China has recently, as pointed out last week, reduced its exports of rare earth metals to a total below that of the current demand just by Japan. In addition China has raised the export taxes on rare earth metals effectively raising the price of those metals directly to those who can still obtain them from China.
Take particular note that the only current producer of lanthanum is China. And its demand for rare earth metals for domestic use in batteries and magnets, for example is rapidly approaching 100% of its production of rare earth metals. The Central Committee of the Communist Party of the People’s Republic of China publishes a five-year plan for the country’s economic growth. The last one called for consolidation and growth in the rare earth mining industry; the next one, which will be promulgated (it is not published as a ‘suggestion;’ it is promulgated as a mandatory decree.) in 2010-11. It is expected that the next one will call for priority for the utilization of Chinese natural resources for the development of the domestic economy. This certainly does not bode well for end users of rare earth metals whose markets are not in China.
Toyota and Honda, the two most profitable and successful, OEM car makers in the world have separately come to the same conclusion. The changeover of the personal vehicle industry from utilizing the hydrocarbon fueled internal-combustion engine as the sole motive power to a completely electric, probably fuel-cell powered, vehicle will go in stages and will stay in any one stage until the technology for the next stage is: developed, tested, and economical.
Toyota and Honda have committed each to having hybrids comprise at least 10% of their manufactured vehicles in the 2011-12 time frame. Both companies see NiMH batteries being used overwhelmingly to make those cars. They hope to achieve as much as 25% conversion of their manufacturing to such hybrids by 2014-15.
It is important for investors to note that the only way for Toyota and Honda to meet these goals is for them to find additional sources of lanthanum outside of China. Because neither company will plan for what is today the remote possibility that, before the beginning of the 21st-century’s third decade, an equivalent lithium-based battery system will be: ready, tested, in mass production, and as reliable and long lived as the NiMH battery, and as cheap to make! If the lanthanum is not found then the world will continue to drive petroleum fueled, internal-combustion engine, powered personal vehicles.
It is possible and, perhaps, even likely that within three years, at most, there may not be enough lanthanum exported from China to enable Toyota and Honda to fulfil their plans to modify their product mix….
Some say that in order for even Toyota’s and Honda’s plans to be successful at the lowest level there needs to be production from rare-earth metal mines in existence now or within only two to three years. Simply put, in order for the markets which critically depend on rare earth metals to go forward as planned—reducing demand for petroleum hydrocarbons and total energy—feasible non-Chinese sources of rare earth metals already known have to be brought into full production within the next five years at most.
Once again these six sources are:
Australia—
Lynas Corporation Ltd (LYC:ASX)
Arafura Resources Limited (ARU)
Canada—
Great Western Minerals Group LTD (GWG)
Avalon Ventures Ltd (AVL)
United States—
Chevron Mining Inc. (CVX)
Thorium Energy, Inc.
The first five companies listed above are publicly traded; the sixth, Thorium Energy, inc. is privately held and, reportedly, not seeking public financing. All have extensive web sites.