Summary
- Livent is one of the few large lithium pure plays prepared for the coming lithium boom.
- Livent's relationship with Tesla will likely be vital for the company moving forward.
- Low lithium prices will likely continue to plague Livent for the near term.
Livent (NYSE:LTHM) has seen its shares skyrocket over the past few months largely as a result of the EV boom. Tesla's (NASDAQ:TSLA) success, in particular, is having an outsized impact on Livent given its expanding partnership with Tesla. Despite the near-term challenges facing the lithium industry, Livent is set up well for long-term success.
Livent further set up the groundwork for high future demand during Q3. During the quarter, the company agreed to invest in New Nemaska and extend its hydroxide supply partnership with Tesla. The New Nemaska project, in particular, will help Livent grow its presence in the North American and European markets by supplying the company with high-grade lithium chemicals.
Livent has seen a major rebound over the past few quarters.
Data by YChartsWell-Positioned to Capture Demand
Long-term lithium demand appears to be healthier than ever due to the rapid rise of EVs. Livent is set to benefit disproportionately from this trend as one of the few large lithium pure plays in the industry. While competitors like Albemarle (NYSE:ALB) only devote a portion of their business to lithium, Livent is all in.
Livent's partnership with Tesla should also give the company an advantage over its competitors. Tesla will likely dominate the EV market for the foreseeable future and could account for the majority of lithium demand for at least a decade given its roadmap. Tesla is already planning to build out massive "terrafactories" dedicated to battery production.
