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Electric cars could rise in price significantly due to the rise in nickel prices

The cost of electric vehicles could rise significantly due to the increase in nickel prices to record levels. Analysts at Morgan Stanley came to this conclusion: according to them, the cost of producing one electric car could increase by an average of $1,000.

Nickel is used in the manufacture of electric vehicle batteries and accounts for a significant portion of the waste. An increase in the price of this metal will lead to an increase in the cost of the electric vehicles themselves.

On March 8, the price of nickel on the London Metal Exchange exceeded $100,000 per ton. This was an all-time high, as a result of which the exchange even had to stop trading in all nickel contracts for the first time since 1988. In total, metal prices increased almost 3.5 times over the week.

Analysts at Morgan Stanley have recommended electric vehicle makers switch to less powerful but nickel-free lithium-ion batteries.

The reason for the growth in the cost of nickel is the situation between Ukraine and Russia: the latter ranks third in the supply of nickel in the world, providing about one tenth of the world's supply of metal.

The Society of Motor Manufacturers and Traders of Great Britain told the Guardian that "the immediate future is uncertain." The head of the organization, Mike Howes, noted that Russia and Ukraine produce commodities important for the European automotive supply chain, including aluminum, palladium and nickel. Rising metal prices will increase the risk to global supply chains, Hawes says.

Electric cars could rise in price significantly due to the rise in nickel prices