The demand for lithium has intensified with the growing popularity of electric vehicles worldwide. It has recently been announced that Ford has entered into a long-term agreement with Qubec's Nemaska Lithium to purchase lithium for its electric vehicle batteries. This agreement will span 11 years and deliver up to 13,000 tons of lithium hydroxide annually, produced at the Bcancour facility. The sustainable source of lithium from Nemaska Lithium meets high standards of quality and sustainability, which should help Ford's vehicles qualify for consumer tax benefits under the U.S. Inflation Reduction Act. This partnership is expected to help millions of customers access and afford EVs over time, according to Lisa Drake, Ford's VP of EV Industrialization, Model e. It will also help strengthen Nemaska Lithium's position in the battery industry's development in Canada and Qubec.

Discuss how economics played into the decision to make this deal. When it comes to contracts, various aspects require careful consideration. These include factors such as pricing fluctuations, mutual benefits for both parties and the contract duration that would be most suitable for the agreement. There are supply chain considerations here as well. Additionally, it is important to consider any initial costs and how they may impact both companies involved.