This is no longer a question of economic axioms, but of the facts on the ground. How do we know that the scale effects relative to lithium mines as they stand today will be sufficient to offset the price increase inherently caused by the increased demand? Do you have a source for this?

The increased demand only causes a temporary increase in price. Lithium is a commodity, and for commodities price == marginal cost.

The marginal cost for lithium is about 1/10th of the current price, so the price of lithium will eventually fall.

Of course "eventually" could be a long time away...

Then why is cost up 10x over the last two years?

Price is up because it takes 18-24 months to produce lithium on the margin. The primary source of lithium is solar concentrated brine, so today’s supply is peak Covid planning decisions.

The people that had the guts to invest in lithium production in the middle of Covid when the price was in the tank, are currently harvesting that lithium and getting a massive payday.

Price will come back down.

Price is up 10x. Cost hasn't changed.

Cost is literally another word for price - I'm not sure what you're trying to convey by trying to distinguish the two. When a battery manufacturer goes to buy a ton to lithium, the cost they have to pay has indeed increased 10x.

The price of extracting a ton of lithium from the ground may be the same, but it's not enough to keep up with demand. Which is why the cost of lithium on the market is skyrocketing.