Credit to Author: Johnna Crider| Date: Fri, 14 Aug 2020 15:40:38 +0000
Published on August 14th, 2020 | by Johnna Crider
August 14th, 2020 by Johnna Crider
In a new report by Wood Mackenzie, the organization forecasts that the global lithium-ion cell manufacturing capacity pipeline could quadruple and reach 1.4 terawatt-hours (TWh) by 2030 compared to last year. The total capacity applies to the 119 battery manufacturing facilities that are operational, under construction, or announced by more than 50 vendors.
Asian manufacturers such as CATL, LG Chem, and BYD will lead the market in this time, according to the researchers. Senior analyst Mitalee Gupta at Wood Mackenzie noted that the manufacturing capacity in the Asian Pacific region makes up almost all of the global capacity at the moment.
Manufacturing capacity in Asia Pacific accounts for 80% of the global capacity pipeline. The region will remain the leader of lithium-ion battery production for the next decade. “Within Asia Pacific, China dominates the pipeline capacity and is expected to double its capacity from 345 gigawatt-hours (GWh) in 2020 to more than 800 GWh by 2030. In addition to local vendors’ rapid expansion in China, foreign manufacturers such as LG Chem, Samsung SDI, and SK Innovation have also been adding new lines after they became eligible for subsidies from the Chinese government in 2019,” she said.
She also pointed out that Europe is getting more competitive. It currently accounts for just 7% of the global capacity. It’s expected to rise up to 25% of the global pipeline capacity in 2030, thanks in part to battery upstart Northvolt (see our three-part interview with its CEO and founder Peter Carlsson here, here, and here). Additionally, major Asian battery manufacturers have been adding capacity in Europe.
“Driven by growing demand for batteries for electric vehicles and energy storage, Asian manufacturers are investing heavily in new plants in Europe, for example, CATL’s Erfurt Plant, LG Chem’s Wroclaw Plant, and Samsung SDI’s Goed Plant. Local manufacturers including Northvolt, ACC, have also put forward ambitious plans to scale up in Europe and localize the battery supply chain,” she said.
In North America, battery production capacity is expected to remain the same over the next decade, the researchers expect. Tesla’s Gigafactory in Nevada is noted as maintaining its central role. There is apparently no forecast in the report for battery production at Tesla Giga Texas (or Tesla Tera Texas). It’s unclear why.
In regards to battery technology, the firm acknowledged that manufacturers don’t normally specify which type of technologies they will be producing at their planned production facilities. This is usually due to the fast pace of advancing technologies. The analysts believe that NMC batteries will maintain their current position throughout the next 10 years and will be closely followed by LFP cathode compositions.
This is certainly not the most bullish forecast. Bloomberg New Energy Finance (BloombergNEF) expects 1 TWh of battery production capacity just by 2025, while Benchmark Minerals expects 1 TWh of capacity by 2022/2023, 1.35 TWh by 2025, and 2.5 TWh by 2030, with China’s CATL accounting for 332 GWh and Tesla, the fourth-largest producer, with 148 GWh of capacity in 2030.
This is just more evidence that the demand for electric vehicles is booming. Demand for batteries created a need for more lithium-ion cell manufacturing capacity. This means that people are becoming more aware of just how important it is to switch to electric, auto companies are ordering batteries, and battery producers are responding. Battery makers wouldn’t be increasing capacity so strongly if they didn’t have demand from automakers.
Earlier this year, Congresswoman Dingell said that the internal combustion engine is becoming obsolete. “The fact of the matter is, the internal combustion engine is becoming obsolete. We need to move to more innovative technologies. We are the nation that developed and gave people the ability to be mobile, to travel around. And I will not cede that to China or India or any country in Europe. We are going to stay at the forefront of innovation and technology, and that’s why it’s so critical to support it.”
CleanTechnica has previously reported that global sales of internal combustion engine vehicles peaked in 2017, and they have decline strongly this year due to the economic effects of the pandemic as well as increasing sales of EVs.
Not only is demand for electric vehicles booming, but automakers are clearly starting to wake up to it. Cadillac just announced its plans to join the EV family with a bang with its new Lyriq EV, which is an all-electric luxury crossover/SUV. It’s expected to go into to production in China probably in 2022, and then later on in the US. 2022 sounds far off, but as fast as 2020 has flown (we are already in August), 2022 will come and go quickly. It takes a long time to get a car into production and ramp up production globally. Look — the Tesla Model Y, heavily based on the Tesla Model 3, isn’t available outside of North America yet. The Tesla Cybertruck is the next hot Tesla model, but it won’t be here until late 2021, and a version designed more for Europe will likely be significantly later. Elon Musk recently responded to CleanTechnica that a smaller version of the Cybertruck for Europe was “highly likely down the road.”
As more people want to make the switch to electric, and more automakers finally wake up and smell the coffee, batteries have to come from somewhere, so it makes sense that lithium-ion cell capacity will quadruple by 2030 — at least.
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Johnna Crider is a Baton Rouge artist, gem, and mineral collector, member of the International Gem Society, and a Tesla shareholder who believes in Elon Musk and Tesla. Elon Musk advised her in 2018 to “Believe in Good.” Tesla is one of many good things to believe in. You can find Johnna on Twitter