Changes in EV sales are most critical for lithium, while copper and aluminum demand is more resilient

Overview

This report focuses on EV supply chain resilience and establishes a global EV metals demand forecasting framework. It breaks demand into battery and non-battery uses, and estimates demand for lithium, nickel, copper, and aluminum by BEV, PHEV, region, battery capacity, and chemistry. In addition to the base forecast, the report sets up two types of scenarios: total EV sales unchanged but a shift from BEVs to PHEVs, and an absolute 1 million-unit change in BEV or PHEV sales, to measure the sensitivity of metals demand and global supply balances.

Core views

Global BEV penetration still has substantial room to increase, but affordability, range anxiety, subsidy withdrawals, and insufficient charging infrastructure may prompt some consumers to choose PHEVs. Because PHEV batteries are typically much smaller than BEV batteries, even if total EV sales remain unchanged, a shift in powertrain mix toward PHEVs would still reduce battery metals demand. Lithium is almost entirely dependent on battery demand, and EV batteries account for a high share of lithium demand, making it the most sensitive to sales and regional mix; nickel is also constrained by the substitution of LFP for high-nickel chemistries; copper and aluminum are widely used in non-battery components such as wiring harnesses, power electronics, and body structures, so their demand is less affected by changes in powertrain mix.

Analysis framework

The research first uses the auto team's regional BEV and PHEV sales forecasts based on government and automaker targets, then combines average battery capacity by region and powertrain type with the shares, energy density, and metal intensity per unit of capacity for chemistries such as NMC, NCA, LFP, LMFP, and sodium-ion to estimate annual metals demand. It then compares demand with global supply and conducts sensitivity analysis through powertrain substitution, absolute sales changes, and regional sales migration.

Methodology notes

• Demand ForecastingThree-variable framework for EV battery metals demand

  EV sales × average battery capacity × metals intensity of battery chemistry

  Annual BEV and PHEV sales determine the number of batteries, regional average capacity determines total energy capacity, and demand for lithium, nickel, copper, and aluminum is then derived based on chemistry shares, energy density, and metal usage per kWh.

• Scenario AnalysisPowertrain substitution scenario with total EV sales unchanged

  BEV growth below the base case and PHEVs making up the sales shortfall

  Assumes the BEV CAGR to 2030 falls from about 19% to 17%, while the PHEV CAGR rises from the base-case 6.3% to about 12%, to measure the impact of a rising share of smaller-battery vehicles on metals demand.

• Sensitivity AnalysisMetals demand elasticity for a 1 million-unit change in sales

  Calculating the demand volume and share of supply corresponding to unit sales changes by region and powertrain type

  Lithium and nickel include only battery demand, while copper and aluminum also include non-battery demand such as wiring harnesses, motors, power electronics, and body structures; except for aluminum, the estimates are broken down by the United States, Europe, China, and other regions.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Lithium

  Highly positively correlated with BEV sales, battery capacity, and EV battery penetration

  Strengths

  The share of lithium demand accounted for by EV batteries is expected to rise from 51% in 2025 to 63% in 2030, with long-term electrification creating significant incremental demand.

  Weaknesses

  Demand is highly concentrated in batteries and lacks the broad non-battery-use buffer seen in copper and aluminum.

  Comparison

  The most sensitive among the analyzed metals to changes in EV sales; for every 1 million-unit change in U.S. BEV sales, the 2026 impact is about 4.0% of global lithium supply.

  Risks

  Slower BEV growth, rising PHEV share, higher share of markets with smaller battery capacity such as China, and penetration of sodium-ion batteries.

• Nickel

  Benefits from EV growth mainly through nickel-containing battery systems such as NMC and NCA

  Strengths

  High-energy-density systems remain suitable for premium and long-range EVs, and EV demand is growing faster than stainless steel demand.

  Weaknesses

  LFP and LMFP do not use nickel, and a higher share of these chemistries would weaken nickel demand per unit of battery capacity.

  Comparison

  Significantly less sensitive to EV sales than lithium; for every 1 million-unit change in U.S. BEV sales, the 2026 impact is about 0.40% of global nickel supply.

  Risks

  Continued LFP substitution for NMC, BEV-to-PHEV shift, declining regional battery capacity, and expansion of nickel market supply.

• Copper

  Benefits simultaneously from battery systems, wiring harnesses, motors, power electronics, and other vehicle electrification components

  Strengths

  Non-battery uses are broad, and BEVs and PHEVs use similar amounts of copper in some non-battery components, making demand relatively resilient.

  Weaknesses

  Changes in EV sales have a limited marginal impact on the global copper supply balance, and copper demand remains mainly driven by broader industrial activity.

  Comparison

  For every 1 million-unit change in U.S. BEV sales, copper demand changes by about 126 kt in 2026, accounting for only 0.35% of global supply.

  Risks

  Weakening global industrial cycle, slower green investment, regional sales migration toward smaller-battery models, and supply response triggered by high profit margins.

• Aluminum

  Mainly used in body structures and other non-battery components, with battery-related demand accounting for a relatively low share

  Strengths

  Aluminum mass in BEVs is expected to show little variation across regions, and per-vehicle aluminum usage in PHEVs is close to that in BEVs.

  Weaknesses

  Incremental elasticity from changes in EV powertrain mix is weak, making it difficult to create a supply-tightness effect similar to lithium.

  Comparison

  Demand is broadly stable under the powertrain substitution scenario; for every 1 million-unit change in U.S. BEV sales, the 2026 impact is about 0.28% of global aluminum supply.

  Risks

  Changes in automotive lightweighting material pathways, slowing global auto sales, weak industrial demand, and new supply.

• Global mining equity portfolio

  Indirectly affected by EV metals demand through metals prices, production volumes, and asset mix

  Strengths

  Barrick, Merdeka Gold, Newmont, and Rio Tinto are rated Outperform.

  Weaknesses

  Antofagasta, Anglo American, BHP, Boliden, Freeport, Glencore, and Vale are rated only Market-Perform.

  Comparison

  The report's ratings are differentiated across mining companies, rather than making a uniform directional call on the entire sector.

  Risks

  Commodity price volatility, project execution, cost inflation, regional and regulatory risks, and EV demand falling short of expectations.

Key data

• Global BEV sales12.7 million units in 2025; 30.1 million units in 2030Corresponds to a CAGR of about 18.8% from 2025 to 2030.
• Global BEV penetration16% in 2025; 37% in 2030; 66% in 2040Bernstein base-case forecast.
• Global PHEV sales6.2 million units in 2025; 8.5 million units in 2030Corresponds to a CAGR of about 6.3% from 2025 to 2030.
• Growth in average BEV battery capacityAbout 3.7% per year before 2030Expected to slow to about 2.1% per year after entering the 2030s.
• Regional battery capacity differencesAverage BEV capacity in China is about 45% lower than in North AmericaAverage battery capacity for PHEVs in China is significantly higher than in other regions.
• LFP and LMFP shareAbout 67% in 2040Cost, safety, and raw material availability support their continued dominance.
• Powertrain substitution scenarioBEV penetration of 34% and PHEV penetration of 13% in 2030The base case is 37% and 10%, respectively; by 2040, the scenario values are 50% and 26%, respectively.
• Demand decline from powertrain substitution67 kt LCE of lithium, 19 kt of nickel, 78 kt of copper, and 35 kt of aluminumAssumes total EV sales are unchanged, BEV growth is 2 percentage points below the base case each year, and PHEVs make up the shortfall.
• Lithium impact of a 1 million-unit change in U.S. BEV sales73 kt LCE in 2026, accounting for 4.00% of global supplyAbout 77 kt LCE in 2030, accounting for 3.27% of global supply.
• Impact on other metals of a 1 million-unit change in U.S. BEV sales22 kt of nickel, 126 kt of copper, and 285 kt of aluminum in 2026Equivalent to about 0.40%, 0.35%, and 0.28% of global supply, respectively.
• Share of lithium demand accounted for by EV batteries51% in 2025; 63% in 2030This explains the high sensitivity of lithium market balance to changes in EV sales.
• Migration of BEV sales from the United States to ChinaFor every 1 million units replaced, lithium demand decreases by 33 kt LCE, nickel decreases by 10 kt, and copper decreases by 19 ktDue to lower average BEV battery capacity in China; the report expects little difference in aluminum usage between BEVs in the two markets.

Impact & implications

The investment implication is that changes in EV sales do not transmit proportionally to all metals. Lithium, because its demand is concentrated in batteries and the EV share continues to rise, is the main bearer of risk from changes in BEV growth, powertrain mix, and regional composition; incremental nickel demand also depends on whether NMC and NCA can withstand LFP substitution. Copper and aluminum are affected by changes in battery capacity, but non-battery uses and broader industrial demand provide a buffer. At the equity level, the report continues to prefer Barrick, Merdeka Gold, Newmont, and Rio Tinto, while maintaining neutral ratings on several diversified miners and copper producers.

Risks

• High interest rates, vehicle affordability, and range anxiety may cause BEV sales to fall below the base forecast.
• The impact of BEV subsidy withdrawals may be greater than for PHEVs, driving the powertrain mix toward smaller-battery models.
• Rising LFP and LMFP shares will weaken nickel demand and change unit-capacity demand across metals.
• Sodium-ion batteries gaining greater share due to cost advantages could reduce lithium demand, but their long-term pathway remains uncertain.
• A shift in EV sales from the United States and Europe to markets with lower average battery capacity such as China would reduce metals demand per unit of sales.
• Insufficient charging infrastructure may extend the lifecycle of PHEVs as a transitional technology.
• Copper, nickel, and aluminum have broad non-EV end uses, and their prices and supply-demand balances may still be mainly influenced by the global industrial cycle and supply changes.
• Long-term assumptions for sales, battery capacity, chemistry, and metals intensity carry high forecasting uncertainty.

What to watch

• Whether global and regional BEV and PHEV sales growth and penetration deviate from the base-case scenario.
• The impact of BEV subsidy withdrawals, financing costs, and vehicle prices on consumers' powertrain choices.
• Migration of EV sales shares among the United States, China, and Europe.
• Changes in average battery capacity and driving range for BEVs and PHEVs.
• Market shares and energy-density progress of LFP, LMFP, NMC, NCA, and sodium-ion batteries.
• Whether EV batteries' share of global lithium demand rises to 63% by 2030 as expected.
• Changes in new supply, inventories, and producer margins for lithium, nickel, copper, and aluminum.
• Earnings and rating changes for Barrick, Merdeka Gold, Newmont, Rio Tinto, and neutrally rated mining companies.