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Electric Vehicles Drive up Metals Demand

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metals demand

The Briefing

  • Electric vehicle sales were down 25% at the start of the pandemic but demand is bouncing back
  • Demand growth from the EV industry is expected to increase as much as 14x by 2030 for certain key metals used in EV production

Electric Vehicles Drive up Metals Demand

Electric vehicle (EV) sales were abruptly interrupted in 2020 due to COVID-19.

However, the consumer base for these cars isn’t going away any time soon. EVs are becoming increasingly popular thanks to higher environmental awareness, falling costs, and ever-improving infrastructure.

Demand for Metals on the Rise

Demand from the EV industry for key metals is on a swift upward trajectory.

Copper, nickel, and lithium are some of the key metals required for EV battery production. As a result, demand growth for nickel from EVs is expected to increase 14 times between 2019-2030. Lithium and copper are expected to experience a growth in demand of 9-10x.

MetalExpected Demand Growth Increase to 2030 in the EV Industry
Nickel14x
Aluminum14x
Phosphorus13x
Iron13x
Copper10x
Graphite10x
Lithium9x
Cobalt3x
Manganese3x

Many of these raw materials come from low to lower middle-income countries and are essential to their economies. For example, around 50% of the world’s cobalt, another key material for EV manufacturing, is found in the Democratic Republic of the Congo.

Investors and mining companies stand to gain from this increased demand for EVs.

What’s Driving Demand?

As consumer awareness increases around climate change and demand shifts away from the oil and gas industry, the demand for EVs grows immensely. According to some estimates, EVs are expected to make up over half of all passenger vehicle sales by 2040.

Additionally, many governments have committed to the production of EVs in a bid to decrease their dependency on fossil fuels. China, for example, has a goal of having EVs make up 20% of new car sales by 2025.

Tesla is leading the momentum among manufacturers and investors clearly see the opportunity, having driven up Tesla’s shares by over 1,000% since March 2020. But there are other up-and-coming players in the EV market like NIO in China, as well as traditional car makers that are shifting their focus to EVs.

Where does this data come from?

Source: Bloomberg NEF

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Datastream

Visualizing Net Worth by Age in America

How much is the average American worth at different ages? This chart reveals the average net worth by age in the U.S.

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net worth by age

The Briefing

  • The age group with the highest average net worth in the U.S. is the 65-74 group, with $1.22 million in 2019 dollars.
  • There is a significant gap between median and mean (average) net worth in nearly every age category, suggesting that mean values are skewed upwards by outliers.

Visualizing Net Worth by Age in America

Calculating the net worth of individuals often seems like the kind of math reserved only for the richest people in the world like Elon Musk or Jack Ma. But as the proverbial pie gets bigger, the net worth of the average American household gets bigger as well.

This chart uses data from the U.S. Federal Reserve Bulletin to reveal median and average household net worth across different age categories in 2019.

Average vs. Median Net Worth

A person’s net worth is a sum of their assets and liabilities. Here’s a closer look at net worth by age in the U.S.

AgeMedian Net Worth 2019 Average Net Worth 2019 Difference
Younger than 35$13,900$76,300>5x
35-44$91,300$436,200>4.5x
45-54$168,600$833,200>4.5x
55-64$212,500$1,175,900>5.5x
65-74$266,400$1,217,700>4.5x
Older than 75$254,800$977,600>3.5x

The age group with the highest net worth is those aged 65-74, sitting at around $1.22 million. Coming in at a close second, are 55-64 year olds, at $1.18 million. However, these are the numbers using the average, while median net worth is quite different.

Median net worth at 65-74, for example, is $266,000, a difference of over $950,000 compared to the average. This reveals that there are likely high net worth individuals skewing the average towards over a million dollars in the same age category.

Both average and median net worth appear to increase throughout one’s life, trailing off slightly around the 75+ age range.

Trends in Net Worth

With the economic impacts of COVID-19, it’s possible that median net worth growth could taper off across nearly every age category, as people lose jobs, income, and assets such as houses.

Average net worth, on the other hand, may not drop as significantly, as a handful of American billionaires have actually increased their net worth during the pandemic.

Overall, wealth has been generally increasing in America with a consistent rise in average and median net worth occurring over the three years leading up to the pandemic. And while this steady increase has likely been slightly derailed, the general trends in asset ownership and income increases over time, bode well for Americans.

Where does this data come from?

Source: U.S. Federal Reserve Bulletin.
Details: Data is in 2019 U.S. dollars.

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Datastream

Ranked: The World’s Least Affordable Cities to Buy a Home

For the 10th consecutive year, Hong Kong ranks as the least affordable city. Vancouver Canada is the second, followed by Sydney, Australia.

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The Briefing

  • For the 10th year in a row, Hong Kong is the world’s least affordable housing market
  • The U.S. is home to a mixture of the most and least affordable housing markets

Ranked: The World’s Least Affordable Cities to Buy a Home

In certain parts of the world, housing prices have risen much faster than household incomes, making home ownership increasingly more difficult for the average Joe.

Using data from Demographia published in 2020, this graphic looks at some of the world’s most expensive housing markets.

The Least Affordable Housing Markets

It’s worth noting that this data looks at housing affordability specifically for middle-income earners. While it’s far from globally exhaustive, it measures affordability in 309 major metropolitan areas across Australia, Canada, Hong Kong, Ireland, New Zealand, Singapore, the U.S., and the UK.

In this study, a city’s affordability is calculated by taking its median housing price and dividing it by the median household income.

  • Moderately Unaffordable: 3.1 to 4.0
  • Seriously Unaffordable: 4.1 to 5.0
  • Severely Unaffordable: 5.1+

All the cities on this graphic classify as severely unaffordable. Perhaps unsurprisingly, Hong Kong is the most unaffordable housing market—scoring 20.8 to take the top spot.

Housing MarketCountryScore
Hong Kong🇨🇳 China20.8
Vancouver, BC🇨🇦 Canada11.9
Sydney, NSW🇦🇺 Australia11.0
Melbourne, VIC🇦🇺 Australia9.5
Los Angeles, CA🇺🇸 United States9.0
Auckland🇳🇿 New Zealand8.6
Toronto, ON🇨🇦 Canada8.6
San Jose, CA🇺🇸 United States8.5
San Francisco, CA🇺🇸 United States8.4
London (Greater London Authority)🇬🇧 United Kingdom8.2
Honolulu, HI🇺🇸 United States8.0
San Diego, CA🇺🇸 United States7.3
Adelaide, SA🇦🇺 Australia6.9
Bournemouth & Dorsett🇬🇧 United Kingdom6.9

Home to 7.5 million people, Hong Kong has ranked as the world’s least affordable city for 10 consecutive years. Because of its steep housing prices, nano apartments have risen in popularity over the last decade.

The Most Affordable Housing Markets

Three of the most expensive housing markets are in America, but at the same time, the country also contains some of the most affordable markets in the eight-country study, too.

In fact, the top 10 most affordable cities are all in America:

CityCountryScore
Rochester, NY🇺🇸 United States2.5
Cleveland, OH🇺🇸 United States2.7
Oklahoma City, OK🇺🇸 United States2.7
Buffalo, NY🇺🇸 United States2.8
Cincinnati, OH-KY-IN🇺🇸 United States2.8
Pittsburgh, PA🇺🇸 United States2.8
St. Louis, MO-IL🇺🇸 United States2.8
Hartford, CT🇺🇸 United States2.9
Indianapolis. IN🇺🇸 United States2.9
Tulsa, OK🇺🇸 United States3.0

Keep in mind, these figures are from Q3’2019. Considering the pandemic-induced suburban shuffle that’s been going on in some of America’s major housing markets, this list could look a bit different in Demographia’s next report.

>>Like this? Then you might like this article on The 10 Most Expensive Cities in the World

Where does this data come from?

Source: Demographia
Details: Affordability score is calculated by taking a city’s median housing price and dividing it by the median household income. Anything over 5.1 is considered severely unaffordable
Notes: Data includes 309 metropolitan markets across eight countries, including Australia, Canada, the U.K., and the U.S., as of the third quarter of 2019

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