Top Reads, Listens & Follows of the week

Managing to the Constraint

Takeaways:

Transportation accounts for the majority (~28%) of the U.S’s greenhouse gas emissions. As such, incentivizing the production and purchase of full battery electric vehicles is top of mind for government officials and the auto industry.

Unfortunately, the focus on full battery EV’s fails to address the primary goal, reducing greenhouse gas emissions, and also fails to consider the primary constraint in their production - sustainably sourcing precious metals. Toyota noted that more than 300 new lithium, cobalt, nickel and graphite mines are needed to meet the expected battery demand by 2035. They estimate such production would take decades to get on line. Rivian’s CEO noted last year that 90-95% of the necessary battery supply chain doesn’t yet exist.

In light of that, consider the reality - one long-range battery EV could instead be used to make ~6 plug-in hybrid electric vehicles or ~90 hybrid electric vehicles. Toyota estimates that the overall carbon reduction of those 90 hybrids over their lifetimes is 37x as much as a single battery electric vehicle. As with much of the hype around the renewable energy transition, the question remains - what are we solving for, and are we effectively managing to the constraints?

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Reads:

The New Yorker on The Titan Submersible (here)

Targeting Toyota for Its Electric-Vehicle Heresy (here)

Bob Iger Isn’t Having Much Fun (here)

The Best Days Are Ahead by Jared Dillian (here)

Listens: 

Michael Cembalest takes everyone to school (here)

Seth Klarman on investing, owning the Red Sox, and winning the Preakness (here)

Josh Kushner - Building Thrive Capital (here)

Follow, Watch & Other great content:

The Bear, Season 2 (trailer here)