WEBVTT - Behind the Battery Recycling Business

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<v Speaker 1>You're listening to Bloomberg Business Week with Carol Messer and

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<v Speaker 1>Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. Bloomberginia recently

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<v Speaker 1>reporting have a tipping point for battery electric vehicle ascendency

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<v Speaker 1>has been reached globally and it's about once five of

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<v Speaker 1>new car sales go fully electric, everything changes, according to

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<v Speaker 1>a Bloomberg analysis of the nineteen countries that have made

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<v Speaker 1>the e V pivot, which kind of got us wondering

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<v Speaker 1>about battery recycling overall. Well, fortunately we got Marcus Randolf

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<v Speaker 1>with us. He's executive chairman, CEO and president Echo Bad

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<v Speaker 1>It's the world's biggest recycler of batteries. Marcus, great to

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<v Speaker 1>have you with us. I want to talk about the

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<v Speaker 1>business in just a second, but give us a macro

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<v Speaker 1>view of your world right now and help us understand

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<v Speaker 1>the biggest challenges your company is facing. Sure, so battery research.

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<v Speaker 1>Let let me start with the quiz. I love this

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<v Speaker 1>because it's her to helps people understand what batteries are about.

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<v Speaker 1>What do you think is the most highly recycled products.

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<v Speaker 1>I know what it is because I looked at the website.

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<v Speaker 1>But you, but you put your paper out on the

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<v Speaker 1>curb and battery led battery recycling and recovery of lead

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<v Speaker 1>through the recycling process. So so lead is by far

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<v Speaker 1>the world's best recycling story. And we're talking about batteries

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<v Speaker 1>like you know during cell batteries, those aren't so lithium ion,

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<v Speaker 1>just lithium referring to lead acid batteries. Now, so you

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<v Speaker 1>find well, well, car batteries, car batteries and those big

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<v Speaker 1>black boxes battercards with the two little posts on them,

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<v Speaker 1>and those things we recycle a hundred and thirty million

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<v Speaker 1>of those a year, big numbers. So what happens is

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<v Speaker 1>we moved to e VS. What does that mean for you? Well,

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<v Speaker 1>EVS does two things. One is, obviously it opens up

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<v Speaker 1>the world for lithium ion batteries, which are very different however,

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<v Speaker 1>I think, and we'll talk about that in a minute,

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<v Speaker 1>i'm sure. But one of the things that gets missed

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<v Speaker 1>is EVS also used lead acid batteries, so all the

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<v Speaker 1>safety systems and e V so you know, the lithium

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<v Speaker 1>part is the motive part, but your powers during your

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<v Speaker 1>power breaks, if if your lithium battery disconnects, you don't

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<v Speaker 1>want your car to lose control. So all air eggs

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<v Speaker 1>and stuff comes from lead acid batteries. So a lot

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<v Speaker 1>of people say lead acid batteries are gonna die, they're

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<v Speaker 1>going to re replaced by lithium. Not true. You know,

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<v Speaker 1>they're still going to be used. Admittedly they don't used

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<v Speaker 1>as much light acid as a car does, but there's

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<v Speaker 1>still it's still a substantial part of our going forward business.

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<v Speaker 1>So how much demand or what are you seeing like

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<v Speaker 1>in your business in terms of diamond dynamics like growth

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<v Speaker 1>of business and so on and so forth, and some

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<v Speaker 1>of the main themes that we talk about, whether it's

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<v Speaker 1>inflationary pressures, labor pressures. Tell us a little bit about that. Well,

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<v Speaker 1>step back, I mean, you know that the word, the

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<v Speaker 1>thing you're never going to get away from is what

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<v Speaker 1>is it mean to have this big boom and e VS?

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<v Speaker 1>And what is that going to do for lithium? So

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<v Speaker 1>you know that the low end of projections is sort

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<v Speaker 1>of compound annual growth rate UM. When you when you

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<v Speaker 1>you know that didn't really matter how much when you

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<v Speaker 1>know you're just selling a few of easy year which

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<v Speaker 1>is where we were it or ten years. Everybody's worried

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<v Speaker 1>about lithium and now now, I mean, you know, including

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<v Speaker 1>plug in electric hybrids, last year there were six point

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<v Speaker 1>six million electric vehicle soul six point six million, almost

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<v Speaker 1>double what they were the prayer year. So you say,

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<v Speaker 1>where's this industry going? For us? Lithium is both our

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<v Speaker 1>greatest threat and our greatest opportunity. So you you look

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<v Speaker 1>at what we're trying to do as we go forward,

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<v Speaker 1>and that's to be we are by far the industry

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<v Speaker 1>leader and lead asset side, and we are rapidly becoming.

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<v Speaker 1>So on the lithiums, you have to well because we

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<v Speaker 1>want to we you know, in other words, to you

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<v Speaker 1>to be honest. I mean, it is going to be

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<v Speaker 1>challenging for lead acid batteries of a long term because

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<v Speaker 1>lithium are just with their energy density is much more

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<v Speaker 1>favorable and their ability to fully discharge is better. So

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<v Speaker 1>they have big advantages. But on costs they get killed.

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<v Speaker 1>And so if you have low cost applications where you

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<v Speaker 1>need big surges of power, that's right down the world

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<v Speaker 1>of lead acid batteries. As you get over the cars

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<v Speaker 1>that have long, steady draws at last for hours, lithium

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<v Speaker 1>batteries are fantastic, They're just expensive. They're hard, to recycle.

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<v Speaker 1>So I give you the numbers for lead sid recycling

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<v Speaker 1>and recovery lite um recoveries. Now, the u e U

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<v Speaker 1>is trying to legislate sixty five percent recovery and there

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<v Speaker 1>are a lot of companies that are making it, meaning

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<v Speaker 1>that of the lithium in a lithium ion battery is recycled,

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<v Speaker 1>the metal is recovered, nickel, copper, cobalt. How usable is

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<v Speaker 1>it on the other side of that recycling? Uh, it

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<v Speaker 1>is and it isn't the this is this is where

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<v Speaker 1>smart question. Yeah, actually that really was a smart people

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<v Speaker 1>talk about, you know, growing the smart economy in the US. Well,

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<v Speaker 1>you look at lithium batteries. You know, the lithium, nickel,

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<v Speaker 1>and cobalt deposits in the US are not very good.

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<v Speaker 1>So all this sus come from someplace else. Then the

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<v Speaker 1>manufacturers are very interested in retaining control through the recycling process.

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<v Speaker 1>So let add the battery. You get rid of it

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<v Speaker 1>out of your car, you leave it at pet boys

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<v Speaker 1>and they give it to us and it just disappears

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<v Speaker 1>in the system in lithium. The car manufacturers want to

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<v Speaker 1>own that stuff right through the process, you know, And

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<v Speaker 1>you just keep going and it's a pretty different business US.

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<v Speaker 1>But you know, kind of the takeaways here is you're

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<v Speaker 1>going to see a lot of demand. I think there

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<v Speaker 1>are a lot of questions about is there enough supply?

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<v Speaker 1>You know, the recycling is really important, particularly because the

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<v Speaker 1>manufacturers weren't own the resources. But starts a different world.

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<v Speaker 1>But the question I think that you're asking is when

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<v Speaker 1>you recycle it it is recycling. Is it comes back

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<v Speaker 1>to write the manufacturer or is it you know he

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<v Speaker 1>did well? Actually, so what happens? So they don't have

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<v Speaker 1>the deposits, so they ship the materials here, they make

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<v Speaker 1>the batteries, or they make them in chump. By the way,

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<v Speaker 1>China has remember the giga factories, Well China has about

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<v Speaker 1>ten times more in the US does. So you start

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<v Speaker 1>severely disadvantage. You don't have many giga factories, you don't

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<v Speaker 1>have many resources. Then you get on the back end

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<v Speaker 1>of this and right now there isn't a single company

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<v Speaker 1>in the US that can make cathode quality lithium ion batteries.

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<v Speaker 1>So they then processed it here, send back to China,

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<v Speaker 1>then it comes back here again. You know. So where

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<v Speaker 1>this industry has got to evolve is it needs to

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<v Speaker 1>get to where we have the full cycle processing capability here,

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<v Speaker 1>and we're somewhat unique, as is ECO Bad, because we're

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<v Speaker 1>in the front end of that and we do the logistics,

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<v Speaker 1>the discharging, the disassembly, the shredding, the production of what's

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<v Speaker 1>called black mass, which is sort of all of the

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<v Speaker 1>metals in one then it goes off to others who

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<v Speaker 1>handle the very back into the process. But TESLA isn't saying, hey, Marcus,

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<v Speaker 1>handle this for us, or are they Well, they're saying

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<v Speaker 1>they want somebody to handle it form and this is

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<v Speaker 1>sort of where the contention is. Well, that is kind

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<v Speaker 1>of open. I think the starting assumption would be it

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<v Speaker 1>would be the black mass processors on the back end,

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<v Speaker 1>But what's actually happened is there is an oversupply of

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<v Speaker 1>black mass processing and there's a shortage on the front

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<v Speaker 1>end of disassembly, logistics and treading, which is why we're

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<v Speaker 1>wanting to invest in that front side. So give us

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<v Speaker 1>an idea of where things go in terms of worth.

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<v Speaker 1>Energy costs so high, and we leave about thirty seconds left,

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<v Speaker 1>so sorry that we're running out of time in your pivot.

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<v Speaker 1>We've only got thirty seconds. You'll have to come back

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<v Speaker 1>at another time. Yeah, based on what you're seeing this

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<v Speaker 1>pivot right to alternative energy EV like, what are you

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<v Speaker 1>seeing or how quickly? Well, I'm gonna I'm gonna leave

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<v Speaker 1>you with something to think about it. I'm kind of

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<v Speaker 1>almost answering your question. Um, you know, as you as

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<v Speaker 1>you think about the story and lead it is the

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<v Speaker 1>best recycled product. And it's also if you don't get

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<v Speaker 1>it right on the recycled side, you are not going

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<v Speaker 1>to have the you know, the the climate changing elements

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<v Speaker 1>necessary to deal with wind power and solar power. You

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<v Speaker 1>need energy storage and that's going to come about through

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<v Speaker 1>companies like Eco bat Right, and we need to be

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<v Speaker 1>really efficient. Um A millionaire questions, So that means you

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<v Speaker 1>must come back where you're based, Santa Fan, Dallas. It's

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<v Speaker 1>an easy flight. Marcus Randolph, executive chairman, CEO and president

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<v Speaker 1>of Eco bat joining us in studio. Man, a busy day.

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<v Speaker 1>I've got another one tomorrow. Yeah, let's let's do it.

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<v Speaker 1>Let's do it tomorrow. All right, you're listening and watching,

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<v Speaker 1>It's a burg business week