A few months ago, perhaps as a public relations countries such as Britain, France and Norway announced they wish to have a fossil fuel ban by 2040. It is true, automobiles are a large contributor to green house gases, however the market is not going to change tomorrow. When the average electric or hybrid car is priced at the entry point of average fossil fuel car, then markets will drastically change. Until then, the hybrid – electric car will be seen as helping save the environment. Hopefully, since all of the countries have automobile plants within their borders, government policies will help the auto companies make the change to electric.

As the change begins, metal markets are changing to reflect the higher need for some metals over the others. To look inside the existing electric cars is to look at different metals than fossil fuel cars, electric cars contain 3 times more copper than fossil fuel. The batteries are a combination of lithium. cobalt, graphite and manganese. In an article titled Electric cars shake up the metal markets by Mark Burton and Eddie Van Walt based in London writing for Bloomberg News, they look at the existing and what might be.

For copper the existing large companies such as Glencore (very strong in copper and the world’s biggest producer of Cobalt), Freepot-McMoRan and First Quantum Minerals .

Lead producers such as Recylex SA and Campine SA are going to have to adapt their operations. Lead is used in starter batteries for fossil fuels but not electric batteries.

Electric batteries are powered by lithium-ion units.

One of the methods to allow cars to travel longer on less power is to make them lighter and automobile companies are using aluminum for that. The steel companies such as AK Steel, ArcelorMittal and Tata are trying to make steel lighter.

Platinum is used in catalytic converters to curb pollution, electric cars do not need them.

A rule of thumb according to Michael Widmer, head of metals market research at Merrill Lynch for metals like copper and nicket, if you underestimate electric sales by 1 percentage point, you can add 1 percentage point to global demand.

Linking to dividend paying stocks, as the make up of the vehicles on the road begins to switch as an investor what you need to do is look under the hood to see what materials are being used. As those change, so does the outlook for the companies who mine and process the materials.

There are more questions than answers, till the next time – to raising questions.