European battery production bottleneck ban on sales of combustion engine cars

According to the European Court of Auditors, China is currently responsible for 76 percent of the global production capacity of accumulators and batteries for electric cars. To help get battery and battery production in the European Union going further, the European Commission published an action plan in 2018. The European Court of Auditors warns that efforts by the European Union to increase its production of batteries, due to factors such as limited access to raw materials, rising costs and strong global competition, may not be sufficient to meet the growing demand for batteries.

“The EU battery industry must not end up in the same dependent position as the natural gas industry. In other words, the economic sovereignty of the EU is at stake,” said Annemie Turtelboom, the ECA Member who led the study. “In preparation for the planned end of sales of new petrol and diesel cars by 2035, the EU is investing heavily in batteries. However, in terms of access to raw materials, attractiveness to investors and costs, the EU may be in a weak position,” Turtelboom said in a statement.

The European accumulator and battery industry received at least €1.7 billion in subsidies and loan guarantees between 2014 and 2020 and a plan for up to €6 billion in state aid was approved between 2019 and 2021. According to the European Commission, according to the European Court of Auditors, there is a lack of proper coordination to ensure that things run smoothly. There could therefore be no guarantee that the EU could increase battery production capacity from 44 GWh in 2020 to 1,200 GWh in 2030. For various reasons. It could be that battery manufacturers prefer other regions to the EU. The United States not only subsidizes the production of raw materials for batteries, but also the sale of EVs produced in the US. In addition, according to the European Court of Auditors, the EU is highly dependent on the import of raw materials for battery production, especially from countries with which it does not have trade agreements, such as China, Australia, South Africa, Gabon, and the Democratic Republic of Congo. Furthermore, rising raw material and energy prices could affect the European competitive position in the field of battery production.

Taking the above into account, the European Court of Auditors is of the opinion that the European Union does not check enough whether European battery production has sufficient capacity to enable the ban on the sale of passenger cars with a conventional internal combustion engine as of 2035. In fact, that ban could easily be called into question.