Man plugging in his electric car to charge

How advancing mobility will disrupt the mining and metals sector

Within a decade, most urban transport will be electric. Is the mining and metals sector ready to meet demand?

In brief

  • Global adoption of electric vehicles is rising fast, with most forms of urban transport to be electrified within the next 10 to 15 years.
  • Accelerating production of EVs will challenge miners to meet surging demand for certain metals and minerals and supply cleaner versions of others.
  • Key actions and investments now can help mining and metals companies build the eMobility supply chains that will be critical to enabling the energy transition.

Globally, adoption of electric vehicles (EVs) is increasing fast. In 2019, around 7.2 million EVs were on the world’s roads, up from just 17,000 in 2010. In at least 20 countries, led by China, EVs reached over 1% of the market share of new vehicle sales.1 Studies suggest that within 10 to 15 years, most forms of urban transport, including buses, taxis, trucks and personal vehicles, will be electric. And, according to the EY Mobility Lens Forecaster, EV sales across the US, Europe and China will surpass the sale of both internal combustion engine (ICE) and fully hybrid vehicles by 2033.

This critical inflection point for the transportation industry also has major implications for the industries that supply it, including mining and metals. Metals with relatively small markets (such as lithium, nickel, cobalt and graphite) are projected to explode in size as EV demand increases. In a scenario where 100% of vehicles are EVs, demand for metals, such as lithium and cobalt, is likely to be 20 times higher than today.2

As well as changes in demand, mining and metals companies also need to consider the impact of car manufacturers’ initiatives to reduce emissions at every stage of the value chain. A growing expectation of low-carbon products is pushing the mining and metals sector toward greater adoption of renewable energy and sustainable production techniques, including electrification of mines and assessing greener alternatives

Electrification of transport offers opportunities across commodities

A powerful combination of industry initiatives and government action, including increasingly stringent emissions regulation, has resulted in a paradigm shift toward eMobility. The electrification of transport is integral to our energy transition and will impact the entire automotive value chain. This offers tremendous opportunities for the mining and metals sector.

But meeting the requirements for more EVs, batteries and infrastructure will also have significant implications on producers of the metals and minerals used to build them.

Steel and aluminium

Steel demand from the automotive sector is expected to remain flat. The reduced volume of steel required for each EV is likely to be offset by the incremental volumes of EVs produced.

Aluminium is projected to see a net incremental demand increase as EV production ramps up. If we consider a midpoint estimate of 250kg per EV with 30 million EVs, the aluminium demand from EVs only will equate to 7.5mt by 2030.3 As EV penetration grows, battery production and charging infrastructure must grow in tandem, and both will require a significant amount of both steel and aluminium.   

How much an EV weighs is a critical factor in its efficiency, which affects its range and appeal to customers. For example, it’s estimated that for every 100kg saved, an EV’s mileage increases by 10% to 11% and reduces battery costs by 20%.4 When lighter materials, such as aluminium, are used to make EV car bodies, this can help offset the weight of batteries. However, as battery technologies evolve, both the cost and weight are declining, leading companies to consider using steel for some applications in low-cost segments. Advanced high-strength steel (AHSS) is increasingly popular with automotive producers due to its ability to provide sustainable lightweight construction – reducing the average weight of a vehicle by 25% to 39% and saving approximately 4.5 tonnes of greenhouse gas emissions over a vehicle’s life cycle.5

Key action for steelmakers:
  • Continue to innovate, as the development of advanced steel products will remain key to capturing incremental market share in the automotive industry. For example, Tesla has recently shifted from using aluminium to a steel-aluminium blend in the construction of the body and chassis of its mass-market Tesla Model 3.
Key action for aluminium producers:
  • Focus on reducing carbon emissions to remain competitive, particularly as OEMs look for substitutes to reduce production-phase emissions. Producers are already increasing investments in recycled or low-carbon metals made with renewables. For example, Hydro’s CIRCAL, which is 75% recycled aluminium, and REDUXA, a low-carbon aluminium, both offer sustainable alternatives to traditional aluminium.6


There is about five times more copper in an EV than in an ICE vehicle. This means that, if we are producing 30 million EVs in 2030, an additional two million tonnes of copper per annum will be required by that point. Copper will also be required for new charging ports and infrastructure, increasing overall demand by 12% to 15%.

This increase in demand, combined with rising production costs and deteriorating ore grades, is likely to push copper prices higher and result in a search for alternatives. Currently, there is no direct substitute for copper, although researchers are experimenting with swapping in aluminium for some applications to reduce the overall cost. While ongoing innovation in battery technology is likely to have some impact on copper demand, overall copper demand from the broader mobility sector is expected to at least double over the next decade.

Key actions for copper miners:
  • Focus on M&A to increase reserves and explore new resources. For example, Zijin Mining Group acquired a 50.1% stake in Tibet Julong Copper for US$548m to further enhance its reserves.
  • Increase exploration expenditures and collaboration with junior miners to develop a partnership at the early stages of growth rather than acquiring a developed asset at a premium valuation.

Battery metals

Demand for lithium, cobalt, nickel, graphite and rare earth metals is likely to grow exponentially to meet rising demand from EVs. Supply-demand mismatch is likely to widen, which is why miners have started allocating capital to these minerals, albeit conservatively. A strong demand outlook coupled with government incentives for EVs is bringing renewed interest in these commodities.7

Several supply challenges are likely to lead to future supply deficits, including the following:

  • Reserves are highly concentrated. Over 50% of lithium reserves are found in Australia, Argentina and Chile, 8 while 75% of global graphite is produced in China. More than 50% of global cobalt production is found in the Democratic Republic of Congo.
  • Complex geology means higher mining costs: for example, extracting lithium from pools of salty water in South America is complicated and expensive.
  • Prices are volatile, which impacts certainty of capital investment.
  • Project lead times are long.
  • Geopolitical risks are high in many mining areas.
Key actions for OEMs and battery manufacturers:
  • Explore strategies to reduce dependence on particular metals or countries.
  • Forge strong partnerships with local producers to secure future supply.
Key actions for miners:
  • Consider non-traditional sources of capital and joint ventures with end users to secure the significant long-term capital needed to confirm ongoing production and exploration of new assets. While access to “conventional capital” has increased, rising geopolitical uncertainty and issues around license to operate are becoming critical factors in determining capital decisions.
  • Work with other stakeholders to collectively develop a more comprehensive market space for battery metals. High volatility in prices is a major hindrance to aggressively increasing production. The commodities market for these metals is not mature; hence, real price discovery is still elusive.

The road ahead

As EV adoption accelerates, mining and metals companies will be central in establishing a secure, sustainable supply chain for their production. “Now is the time for metal producers to invest more in innovation and increase production of low-carbon products,” said Paul D. Mitchell, EY Global Mining & Metals Leader.

Meeting demand is unlikely to be an issue for producers of steel, aluminium and copper, but demand for green versions, particularly aluminium, is likely to rise, as concerns over carbon emissions increase. Price premiums associated with low-carbon products and metal supply constraints will increase the cost of raw materials, making it more important to increase efficiency of production to maximize profitability and drive a sector-wide shift toward decarbonized processes.

Meeting future needs for battery metals will require significant investment now. We are already seeing strategic partnerships along the EV value chain to confirm security of supply and, more recently, moves by OEMs into upstream mining assets.

Scrap supply of these battery metals will also become crucial, although this is not likely to be a real option until the end of the next decade. Another option is for producers to reduce the size of batteries and therefore the amount of battery minerals required. However, this will only be feasible when governments are able to provide robust reliable charging infrastructure throughout their countries.

The electrification of transport will be a crucial lever in meeting global decarbonization goals. Investment now across the EV value chain will enable this next wave of the energy transition and build an integrated and resilient eMobility supply chain for the future.


Global EV adoption is accelerating fast, with EY forecasts predicting that EV sales in major markets will surpass that of traditional vehicles by 2033. The electrification of transport has huge implications for mining and metals companies, as they will face significantly increased demand for certain commodities, such as copper and lithium, and renewed pressure to produce greener versions of aluminium and steel. Mining and metals companies must act now to confirm they are ready to play their part in securing the sustainable eMobility supply chain that will enable the next wave of the energy transition.

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