The European environmental organization Transport & Environment (T&E) is calling for greater support from Brussels for independent car battery production in the EU. The international community might end its dependence on lithium-ion batteries from Chinese manufacturers by 2027.
However, manufacturers such as the US electrical pioneer Tesla and the Swedish start-up Northvolt might also orient themselves more towards the USA in view of the high funding opportunities in the United States, according to a report published by the organization on Tuesday.
Half of the lithium-ion batteries used in the EU are already being manufactured in Europe. “But the Inflation Reduction Act has changed the rules of the game,” said T&E Germany boss Sebastian Bock, referring to US subsidies. “More financial resources must be made available in Europe or we risk losing planned battery factories and jobs to America.”
USA subsidize massively
In the Inflation Reduction Act, the USA has promised substantial subsidies for e-car and battery manufacturers if they invest in the USA. In Europe, battery manufacturers such as the Chinese industry giant CATL, the Koreans from Samsung SDI and the Swedes with Northvolt have announced billions in investments. Car manufacturers such as Volkswagen, Mercedes-Benz and Stellantis are also investing in cell plants, while others such as BMW are ordering from battery suppliers on a large scale.
However, with President Joe Biden’s US stimulus package, the balance of power threatens to shift towards the United States. There are doubts as to whether Northvolt is still building a factory in Schleswig-Holstein as originally planned. T&E calls for a European promotional fund to be financed through the joint issuance of bonds. Only products that are also subsidized by the Inflation Reduction Act, such as electric cars, batteries and renewable energies, should receive funding from this. According to T&E, the funds should flow directly to the companies in order to prevent the slow drawdown of funds that is observed with other funding instruments. (apa)
