Leading the Alternative World Order

Reshaping Perspectives and Catalyzing Diplomatic Evolution

Thursday, September 28, 2023


Subscribe to our Newsletter

- Gain full access to our premium content

- Never miss a story with active notifications

- Exclusive stories right into your inbox

WorldEuropeStrong European expansion in the automotive battery industry

Strong European expansion in the automotive battery industry

Nearly 50 lithium-ion battery factories are expected to be built in Europe by 2030, which is almost non-existent today.

“Europe has the means to be competitive. We are in an acceptable position but the pressure is mounting,” said Tobias Gerke, economic geography researcher at the European Council on Foreign Relations (ECFR), according to a report by the AFP.

Germany is the most advanced country with 498 GWh of projects in progress, followed by Hungary (224 GWh) and Norway (136 GWh). France comes in fourth place with 122 GWh, according to the non-governmental organization Transport et Environnement. Taiwanese group ProLogium has confirmed it will build a fourth factory in Dunkirk, which President Emmanuel Macron is visiting on Friday.

But according to the NGO, 68% of these projects are not final and could be “reduced or delayed if not canceled”, in particular because of American competition boosted by subsidies from the Inflation Reduction Act (IRA).

This US government plan provides massive tax breaks for green industry and energy transition to counter the boom in renewable energy in China.

“Basically, the US inflation bill cuts taxes on electricity generation to fund green electricity,” says Tobias Gerke. Hydrogen, for example, is now more affordable thanks to this legislation.

Low competitiveness

Europe suffers from a major problem of competitiveness. “We pay twice as much for electricity as in China,” Gerke says regretfully. He adds that we must “provide energy subsidies to catch up. The Americans understood this and passed the legislation”.

In December, the cost of lithium-ion batteries was 24% higher in the United States than in China. In Europe it was 34% more expensive.

The researcher says Europe’s goal of producing all the batteries needed by the automotive industry on its soil by 2030 seems unrealistic at this stage.

Another major obstacle is access to basic materials such as graphite, lithium, nickel, manganese and cobalt, the supply chain of which is largely controlled by China.

China controls 75% of lithium refining and 50% of cobalt, and is expected to maintain its leadership in battery production over the next five years, according to Bloomberg NEF forecasts.

Total electricity dependence in 2035

Faced with this situation, Europe has started to act with the publication of the “Law on Critical Raw Materials which sets the objective of establishing strategic partnerships and creating a common supply platform at the level of the ‘EU,” explained Diane Strauss, director of the Transport and Environment Organisation. In France.

She added that Europe, although it has not passed “a law as strong as US law”, but has made it easier for member states to “disburse government aid”.

Europe is starting from a position of weakness vis-à-vis China, which is far ahead of it, and the United States, which have incomparable financial power, but it can rely on its internal market, which is one of the first markets for electric cars. , although China is still ahead.

“Europe is a bit ahead of the United States in terms of dependence on electric vehicles,” says Gail Norman, vice-president of ProLogium, which wants to open its factory in Dunkirk by the end of 2026. Europe has very clear legislation,” with a commitment to sell new zero-emission cars from 2035. “This legislation is clear for manufacturers,” he adds, so “when we decided to expand, we we chose Europe”.

Read the Latest World News Today on The Eastern Herald.

For the latest updates and news follow The Eastern Herald on Google News, Instagram, Facebook, and Twitter. To show your support click here.


Arab Desk
Arab Desk
The Eastern Herald’s Arab Desk validates the stories published under this byline. That includes editorials, news stories, letters to the editor, and multimedia features on easternherald.com.

Public Reaction

This site uses Akismet to reduce spam. Learn how your comment data is processed.