China has emerged as the dominant force in the global electric vehicle (EV) battery industry, accounting for 70% of worldwide production. This remarkable achievement has piqued the interest of other major players like the United States, the United Kingdom, and Japan, who are now conspiring to secure the necessary raw materials from China.
China has established a comprehensive supply chain for EV batteries, achieving unprecedented success. In the first three quarters of the year, China produced 89 GWh of e-batteries, doubling its previous output and making up 88% of global exports. As a result, the option of looking to other countries for these materials is gaining traction. Companies like Gotion High-tech, CATL, and EVE Energy are already making significant investments in lithium battery plants in the United States and Europe.
Despite these positive developments, certain joint ventures between Chinese and American companies have faced criticism. The proposed $3.5 billion battery plant collaboration between CATL and Ford raised concerns, as it could potentially redirect US subsidies to China.
On the international front, there have been notable advancements in securing critical raw materials. The United States, Japan, and the United Kingdom have made significant progress towards an agreement that would provide tax benefits for clean vehicles under the US Inflation Reduction Act. However, a primary aim of this agreement is to reduce reliance on China for processing these essential materials.
The European think tank Bruegel is proposing a partnership for the development of green technology, based on the concept of ‘coordinated specialization.’ This approach encourages participating countries to specialize in areas where they excel most efficiently, ultimately diversifying the global supply chain.
China’s presence in international markets continues to grow. In K3, Chinese companies have been granted licenses that could lead to $2.79 billion in investments in Zimbabwe, particularly in the mining and energy sectors. The government of Zimbabwe is actively promoting large lithium supplies and working to address power outages, with China’s investments representing a significant boost to the country’s economy.
