The electrification trend of automobiles is irreversible, and the demand for power batteries has also increased. The research organization Wood Mackenzie Power & Renewables recently released a report predicting that the battery capacity in Europe will grow 20 times in the next 7 years, and the battery output is expected to increase by 90GWh by 2025.
The Asian market, represented by China, Japan, and South Korea, has long been a major producer of power batteries, and currently accounts for 65% of the global battery market. In order not to rely too much on battery technology in other countries, the European Union had previously announced the allocation of billions of euros to finance the development of power battery technology and the construction of battery factories by major EU car companies.
Wood Mackenzie Power & Renewables analyst Mitalee Gupta said that some European and Asian battery manufacturers are actively building factories in Europe for this purpose.
Among the battery companies that have sprung up, Swedish startup Northvolt, founded by former Tesla employees, just announced in October that it will build a battery manufacturing center in Gdansk, and assemble Swedish battery modules from Skellefteo. The initial capacity is expected to be 1 10,000 battery modules, the factory is expected to be completed in 2019. Northvolt's other battery plant is also under development, with capacity expected to reach 32 GWh by 2023. In order to meet the growing demand for complete battery solutions in the European market.
Earlier in October, Northvolt stated that it would join forces with BMW Group and recycling technology provider Umicore to establish a battery life cycle system, put scrap materials into the manufacturing process, and seek to use renewable energy to provide manufacturing Power source.
German chemical product giant BASF (BASF) also announced in October that it will establish a lithium battery anode material factory in Harjavalta, western Finland, to meet the demand for power batteries. In addition, it signed a supply agreement for nickel and cobalt materials with Russian mining giant Norilsk Nickel. The Finnish plant is expected to start production at the end of 2020, with an annual capacity of about 300,000 electric vehicle batteries.
Like Northvolt, BASF plans to use local renewable energy sources including hydro, wind and biomass to power Harjavalta's plant.
According to Reuters, Chinese lithium battery maker Farasis Energy plans to set up a factory in Germany by 2021 after receiving a $ 1 billion financing in September. BYD also plans to build a battery production line in Europe.
And battery manufacturers that are already in the head camp in the European market, such as Amperex Technology, LG Chem, Samsung SDI, SK Innovation, GSR Capital, GS Yuasa, etc., their production scale Expansion plans are even bigger.
South Korean battery makers are also seizing the door to the European market. LG Chem has built a battery factory in Poland, with an annual production capacity of 100,000 electric vehicles. Samsung SDI and SK Innovation also plan to build battery plants in Hungary. The former plans to build a plant in Budapest. The annual production capacity is expected to supply 50,000 electric vehicles. The latter will be supplied to Daimler and Mercedes-Benz. The output can reach 7.5GWh.
Automobile is one of the important pillar industries of European economy. In Europe, about 5% of the labor force is engaged in automobile-related work. Electric vehicles will gradually replace fuel vehicles in the future, and a large number of tasks related to fuel engines may disappear in the future.
European Commission Vice President of Energy Maros Sefcovic said that passenger cars will be electrified in the future, and if you cannot master the innovation, development and manufacturing of batteries, you will not be able to launch competitive electric vehicle products.
Power batteries are the core components of electric vehicles. According to the current capacity and commissioning plan of lithium batteries, 80% of global lithium battery production is in Asia, especially in China. European companies have strong competitiveness in the fuel vehicle market, but lag behind Asian companies in the development of electric vehicles and the development of power batteries. In order to accelerate the development of the European battery industry, the European Union established a battery industry alliance in 2017 to provide more funding and technical support for European battery manufacturers. Daimler, Siemens, BASF, Renault and other large companies have participated in it.
The EU plans to approve member states to provide funding for battery research and development and provide billions of euros in self-sustainment to companies building large battery plants. Individual EU member states have also been approved to provide 100% of funds for battery research and development. The European Horizon Fund will invest 200 million euros for battery research and development and 800 million euros for infrastructure construction of battery-related industries. The total amount of funds that companies can apply for is up to 2.2 billion Euro, and more funds will be invested in the development of the European battery industry.
European battery makers really need financial support. Northvolt mentioned above plans to invest 5 billion euros to build a super factory in Sweden. There are three companies with the same goals as Northvolt. French battery maker Saft has reached cooperation with Siemens, Solvay and Manz. Umicore will invest in Poland to build a plant. German battery maker Varta may cooperate with Ford.
Analysts said that Chinese power battery manufacturers have a first-mover advantage. Even if all the battery manufacturing capacity that Europe is planning to invest is put into production, it is behind China by at least ten years in battery and electric vehicle manufacturing. Before the development of the European battery industry, European car manufacturers will become the main customers of Chinese battery manufacturers. For example, in July 2018, the BMW Group announced that it would purchase $ 4.7 billion from Chinese battery manufacturer Ningde Times (CATL). Power batteries to support the development of its electric vehicle business.