Downturns pose challenges for company balance sheets, but producers that reach the other side often end up in an enviable position.
This was the case with Pilbara Minerals during the last lithium downturn and is the case with Liontown Resources amidst the current bear market.
Pilbara Minerals, now called PLS, entered production at its Pilgangoora operation in WA just prior to the 2018–20 downturn and was forced to weather the storm just as it started generating cashflow.
The company reached the other side, acquiring Altura’s nearby operations in the process, and was primed to capitalise on the price revival in mid-2020 with larger assets at its disposal.
Pilbara Minerals has gone on to become one of the world’s premier lithium brands, recently expanding into Brazil through the acquisition of Latin Resources.
Liontown could use Pilbara’s journey as inspiration for what it is currently navigating.
The company entered production in mid-2024 in the midst of the lithium winter, and recently posting its first half-year of operations, with 116,854 tonnes of spodumene concentrate produced to December 31.
One thing working in Liontown’s favour is that low commodity prices tend to dissuade the development of competing projects and production. This means that if and when lithium prices reignite, the company will have clear air to deliver the spodumene that the world needs.
While some critical minerals are facing competition from other commodities when it comes to optimising battery chemistries for electric vehicles and other renewable energy technologies, lithium will remain a cornerstone of battery development for a while yet.
This means that while the slump continues, lithium’s longer-term outlook remains strong.
Global electric vehicle (EV) sales saw a 50 per cent year-on-year (yoy) rise in February 2025, with China and Europe leading the way.
EV sales hit 1.2 million in February, according to data from Benchmark company Rho Motion, with the Chinese market increasing by 76 per cent yoy.
“It’s been a solid start to the year for EV sales globally with a 50 per cent bump in February compared to the previous year,” Rho Motion data manager Charles Lester said.
“Much of the growth continues to come from China which are seeing a pure electric renaissance this year compared to the hybrid love affair of 2024. Despite high tariffs, their domestic brand, BYD, shows no signs of slowing down their home and international expansion.”
For the benefits of Pilbara Minerals and Liontown Resources, here’s hoping EV sales continue to surge and drive renewed demand for raw materials.
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