Growth of Lithium Recycling Could Charge “LIT” ETF

As Tesla stock crosses the $700 per share mark, it’s just another reminder of where the automotive industry is heading with an influx of more electric vehicles. Additionally, more recycling facilities for lithium batteries is another telltale sign, which could charge up the Global X Lithium & Battery Tech ETF (NYSEArca: LIT).

According to an Energy Storage News report, “a new lithium battery recycling facility, established by operator Li-Cycle on a commercial basis at the well-known Eastman Business Park in New York State, answers both a growing need and an opportunity in an ‘unprecedented phase’ of deployment, the company has said.”

“The deployment of Li-Cycle’s Rochester facility marks a major milestone for the company and just a first step to address this global mass market opportunity,” the company said.“As the world enters an unprecedented phase of lithium-ion batteries across a broad spectrum of products and industries, lithium-ion battery waste is forecasted to hit anywhere from one to four million tonnes per year globally by 2030, depending on the source of the study. This translates into a potential material value to be recovered from lithium-ion batteries of US$6 billion by 2030.”

Lithium-ion battery capacity is vital because one of the primary factors car buyers consider when evaluating electric vehicles is how long those vehicles can run on a single charge. Tesla’s dominance in the booming electric vehicle market will also move the demand for lithium.

Most recently, the Super Bowl featured more ads from automakers looking to advertise their electric vehicles, including model offerings from General Motors, Porsche and Audi. General Motors took the opportunity of the increased viewership during the big game by promoting their all-electric Hummer truck with help from basketball star LeBron James.

As such, investors can make an indirect play on lithium growth via electric cars with the Global X Autonomous & Electric Vehicles ETF (NYSEArca: DRIV). DRIV seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Solactive Autonomous & Electric Vehicles Index.

DRIV provides:

  • High Growth Potential: DRIV enables investors to access high growth potential through companies critical to the development of autonomous and electric vehicles – a potentially transformative economic innovation.
  • Unconstrained Approach: DRIV’s composition transcends classic sector, industry, and geographic classifications by tracking an emerging technological theme.
  • ETF Efficiency: In a single trade, DRIV delivers access to dozens of companies with high exposure to the autonomous and electric vehicles theme.

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