What's going on?

Chinese EV maker Xpeng reported a higher-than-expected loss on Monday.

What does this mean?

Investors aren�t an easy breed to please right now: they sent Xpeng�s share price down 5%, even as the company grew quarterly revenue by an impressive 153% and more than doubled the number of cars it delivered last quarter from the same time in 2021. That was probably because they couldn�t see beyond the higher-than-expected $260 million loss it posted, as the EV maker grappled with Chinese lockdowns and surging raw materials prices. Xpeng�s other revelations probably didn�t help settle their stomachs, either: the company acknowledged that shipments were already down 42% between March and April, leading it to issue a worse-than-expected revenue outlook for this quarter.

Why should I care?

The bigger picture: Tesla has no friends.
Xpeng isn�t the only EV producer to be hit by China�s lockdowns: Tesla�s domestic deliveries in the country fell 90% last month from the same time last year. But while Tesla is confident that the market is still ripe for the picking, plenty of its suppliers have announced plans to move at least parts of their production elsewhere. Take Primax Electronics: the camera supplier unveiled plans to reduce manufacturing in China by 2024, and shift its production to Thailand and the Czech Republic instead. Analysts think this could be a sign of things to come, arguing that China�s zero-Covid policy could accelerate the trend toward more evenly distributed supply chains.

Zooming out: Someone get this country some lithium.
That�s certainly likely to be the case for EV battery material lithium, which both Europe and North America are trying to build up their own supplies of. That�s no mean feat: analysts have estimated that demand for the material will quadruple by the end of the decade, and that the sector will need $7 billion of investment every year until 2028 if it wants to meet the need (tweet this).