Lithium — the lowdown

A white/silver alkali metal, lithium is the lightest metal on earth. Although it occurs in many rocks and brine deposits, such sources are often of little commercial value because the lithium is in low concentrations or is of low grade. For this reason, lithium could be considered a comparatively rare element. To be suitable for use in car battery applications, lithium must be turned into high-purity (99.95%) Battery Grade Lithium Carbonate — an even rarer compound.

China's Green Cars

Whatever the state of global lithium reserves, it's a fair bet that the US, China and Japan will compete to secure supplies over the next decade. To compete with GM's Volt, Honda's Prius and Nissan's Leaf, Chinese battery and automobile manufacturer BYD is making a splash with its first plug-in hybrid and plans to release two all-electric models later this year.

Founded in 1995 in Shenzhen by chemist Wang Chuanfu as a rechargeable battery manufacturer, BYD targeted Sony and Sanyo as its competitors. By using inexpensive manual labour rather then pricy mechanised production, BYD reduced battery prices and, within five years, became one of the largest battery makers in the world. In 2003, Wang acquired Tsinchuan Automobile Company, and began developing the technology for EVs. By July 2009, BYD Auto was the top independent automotive brand in China, according to the Chinese Association of Automobile Manufacturers, with 33,860 units sold, 22,183 of which were its F3 sedan, making it the month's best-selling sedan in China.

But BYD sees a future in EVs and is confident that both its all-electric and dual-mode (plug-in electric with a back-up gasoline engine) will be able to compete with the models of better-known international companies. Listed on the Hong Kong Stock Exchange at a market value of €2.65bn, and with net profits for 2008 around $187m (€130m), BYD Company Ltd is on the up. Globally, its corporate profile was further bolstered when Warren Buffet bought 10% of the company in 2008. And BYD's transformation from cell phone battery maker to car maker to electric car maker in under 15 years shows an adaptability and innovative approach that suggests that, even in the event of a lithium shortage, BYD will find creative ways to deal with it.