U.S. Electric Car Battery Production Is Lacking, Says Expert

OCT 7 2018 BY VANJA KLJAIC 80

Currently, China’s share of the global Li-ion battery production capacity exceeds 50%.

Even with the escalating U.S.-China trade war, the Chinese share of global Li-ion battery production capacity still exceeds 50% of the market share. In turn, this puts its eight U.S manufacturers – only one of which is completely independent – to shame. And this prompted Jim Greenberger, executive director of the National Alliance of Transportation Batteries (NATTBatt), to warn that the U.S. economic security could be vulnerable to having virtually no homegrown lithium cell-production capability.

“When we started NATTBatt nearly a decade ago,” Greenberger (below, left) says at the recent Battery Show held here, “we said that ‘He who makes the batteries will eventually make the cars.’ So this is…about national economic security.”

Only one U.S based battery manufacturer, Indianapolis-based EnerDel, is completely independent and not owned by any foreign companies. Furthermore, EnerDel also is one of the smallest Li-ion battery makers, with their entire battery production capacity estimated at 200 MWh. All the rest are either wholly or partly foreign-owned or rely on foreign technology to produce their batteries. And this comes as a warning to the current U.S governmental officials, due to the overreliance on foreign battery technology.

For Greenberger, who chairs a Chicago-based trade association that aims to promote advanced-battery industry in North America, spoke to Wards Auto a few days earlier. There, he vocalized his concerns about the current state and the future of the advanced battery industry in the U.S.

“If we are interested in bringing battery manufacturing back to the United States, we are not going to outbid the Chinese. “In fact, I don’t see any prospect that we are going to be willing to make the investment in lithium.”

“My own view is that from a national perspective, we really should be looking at the next generation of battery technology…or non-battery technology…trying to make sufficient public investments to make sure that when those technologies are ready that it is North American companies that will dominate the market,” he says.

“They have simply out-invested us, and they have certain national needs which are driving electrification that are far more urgent than the need for electrification in North America. But at some point, we are going to have to start making public investment in whatever we think the next-generation battery is going to be if we are going to get back in the game.

“Maybe it will be zinc. Maybe it will be solid state or solid lithium. Maybe it will be fuel cells,” Greenberger says. “I would be looking at how to get beyond lithium-ion and making sure that the United States is investing in whatever is going to replace it.”

Furthermore, to make matters even worse, there’s speculation that CATL – China’s largest Li-ion battery maker – which in July announced plans to build a 14-GWh plant in Germany, has its sights set on the U.S as well. This would further make the U.S fall behind on both battery tech and volume, making the world’s biggest economy be put at risk in various aspects. Plainly put, the United States is lagging behind and measures will need to be taken to combat the recent Chinese developments fully.

Source: Wards Auto

Categories: Battery Tech, China

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80 Comments on "U.S. Electric Car Battery Production Is Lacking, Says Expert"

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ffbj

There is a problem, but this guy is clueless.
The Legacy American car industry chose not to invest in battery technology.
Luckily we have Tesla, and they, unlike you, are not clueless.
For such an expert he certainly uses the word maybe a lot.

SJC

It does not have to be the car industry, LG and Samsung don’t make cars.

Ron M

Yeah Apple has plenty of money. Why don’t they build a GF battery in the US. Seems Trump said Apple told him they were going to invest a trillion in the US after the tax breaks and bringing back the offshore money for 5-10% in taxes.

John Doe

Hell freezes over before Apple invest in production, or invest money in basic technology like for example IBM. Just look at hardware patents.
They still make tonns of money, using technology other companies have developed. They may give a display made by Samsung or LG their own name, but the product is not special anyway.
That is why I like Tesla, and their will to produce things themselves.
Apple would just have given the manufacturing job to a contract manufacturer.
Trump should have closed all the tax havens in the world. The US would have gotten a lot of extra money to use for infrastructure, education, health and what not. I’m sure a tiny tax haven would have changed their tax situation with a huge carrier outside in their harbour.
Give me 25 seconds, and I will send you a PDF of all the tax cheaters.
Given record dept (www.usdebtclock.org) the richest 1% should pay more.
When Apple used to loan money to pay for saleries, insted of use some of the billions they have stached away – they are clearly showing the problem with huge companies that dodge taxes.
They pay a fraction of what an average middle class worked does (In percent of income).

Ron M

I hear you loud and clear. Bush gave these same companies a tax holiday to bring money offshore back to the US and10 years later we do it again how stupid. We should have passed a law that you bring all the money back and tax them at the highest rate. Of course Trump wouldn’t do that because tax evasion is in his blood. September 30, 2018 was the end of the fiscal year and it’s probably going to be over 900 billion. When we have a good economy the budget deficit should go down.

Pushmi-Pullyu

“Trump should have closed all the tax havens in the world.”

1. The Big Cheeto isn’t a dictator… despite how intensely he desires to be. Laws are passed by Congress, not the President.

2. The Big Cheeto would never close tax havens, because then he, his family, and his fellow gangsters cronies wouldn’t be able to use them.

whereismycoffee

L.G. makes the Bolt drivetrain.

Pushmi-Pullyu

Makes the entire powertrain, from battery cells to power electronic module (including the inverter) and the electric motor.

GM is demonstrating by its actions that it has no interest in actually building BEVs.

antrik

The Bolt is a compliance car, no doubt about that; but they claim their next platform that’s in the works is supposed to actually be profitable…

Some Guy

The point is, they don’t make cars yet. When the iPhone came out, Samsung did not make Smartphones. Few years later, they were market leader.
LG already knows how to make a pack with complete drive train. I’m pretty confident that they will supply the legacy ICE manufacturers for many years and scale up to insane levels of battery production capacity. Then they will start making cars as well.

Pushmi-Pullyu

Let us please not confuse light manufacturing products (cell phones) with heavy manufacturing products (automobiles).

The economic cases are very different. Heavy industry requires large amounts of capital and generally produces thin profit margins. For consumer electronics in high demand, it’s the reverse.

antrik

Really? I find it hard to believe that Samsung didn’t make any smartphones before the iPhone… They did make mobile phones in general *long* before Apple arrived.

skierpage

I was surfing the Web, playing third-party games and apps, and making phone calls on my touchscreen Samsung sph-i300 phone in 2001 running the Palm OS for PDAs (personal digital assistants). I bought two subsequent Samsung models before the iPhone came out in 2007.

The iPhone changed the phone and computer industries, but nothing in it was brand new.

ffbj

True..

Magnus H

Tesla’s batteries are produced by Panasonic, a Japanese manufacturer.

EV Tart

P{lease read cell, cheap cells , pouch cells and battery differences and cost , so you understand what the difference.

Pushmi-Pullyu

I think it’s you who does not understand the differences. A difference in form factor (pouch vs. cylindrical) isn’t that significant. Certainly not as significant as differences in chemistry, cost per kWh… or, from the viewpoint of trade and currency exchange rates, what the country of origin is.

Windbourne

I believe that Tart’s point is that Panasonic does NOT make Tesla batteries.
They make 2 types of CELLS that Tesla buys.
the first is Panasonic’s Cell.
The second is actually Tesla’s cell, but manufacturing is farmed out to Panasonic.

Pushmi-Pullyu

This meme of building a “battery” without using cells… I don’t understand that at all. The word “battery” means several things working in concert. What do you think those “things” are? Hint: They’re not chocolate mints!

This whole concept seems to be a rampant case of the sort of zero-sum thinking that afflicts “America First-ers”. In the real world, far more is achieved by human beings working together toward a common goal. For example, Tesla’s successful partnership with Panasonic.

There is a true partnership at work. With its advanced battery cell analysis lab, Tesla is very much involved with deciding just what is the best chemistry and internal structure for its battery cells. But that’s a matter of analyzing the different types of cells made by Panasonic and other battery makers. Advances in battery chemistry and components are coming from Panasonic and other battery makers… not from Tesla!

The idea that Tesla should or could go it alone in building battery packs, without its partner Panasonic… that’s pretty foolish.

Will

I have to agree. All through the article he conflates cells and batteries, and conflates EV batteries with other applications. And somehow manages to avoid mentioning Tesla altogether even though Tesla is currently the world’s largest EV battery producer using their Panasonic cells. And for those not familiar with the technology, yes, Tesla makes their own battery packs.

Stan1

“…using their Panasonic cells.”

I believe you know this but all of the cells Tesla uses from Panasonic no matter where they are made are a Panasonic and Tesla mix right down to the chemistry.

antrik

I think it’s quite obvious from context that the article is all about cells, not packs.

Fool Cells

What is stopping Ford, GM, Fiat, etc.. from building battery plants? Tesla is cranking out tons of batteries and will ramp up to making even more. The legacy car companies are run by idiots who are waiting for the next taxpayer bail out.

antrik

They don’t want to take the risk. They just want to buy the product, not caring where or by whom it is made…

Ron M

Yeah and Trump blames other countries for the deficit when it’s US companies that don’t invest in America. Maybe the problem is US companies not foreign countries for the trade deficit

Else

They just want to make the metal sheets

Pushmi-Pullyu

“They don’t want to take the risk.”

Exactly. And just how insane is this, is shown by Volkswagen’s plan to invest $48 billion (yes, that’s billion with a “b”) in ensuring near-future battery supplies, which means they are subsidizing battery makers to build their own high-capacity factories whose output will be controlled by those battery makers… instead of doing what Tesla has done, forming a partnership with a leading battery maker in building a high-capacity factory whose output is controlled by Tesla, not Panasonic

We also see that now Tesla has the #4 best-selling car in the U.S. No other auto maker (with the possible exception of BYD, which also owns its own battery factories) would be able to do that, because they lack access to that kind of battery supply.

https://cleantechnica.com/2018/05/04/volkswagen-doubles-ev-battery-order-to-48-billion/

antrik

And how many billions every year do you think VW is spending on other components, and even raw materials, from various suppliers? Do you call these “subsidies”, too? Should they make all these things in-house instead? Down to digging their own metal ores?

There is always a point where you start outsourcing — and right now, it’s *not* clear that outsourcing cell production is a bad idea.

Mint

Nobody has any idea what the details are about VW’s arrangement with the battery suppliers is, so you are being very presumptuous.

It could be that VW’s $48B contract has plenty of escape clauses, and thus isn’t firm enough to encourage very high production.

It could be a partnership where VW gains part ownership of the facility.

It could be smarter and more effective than Tesla’s relationship.

Until everything plays out (or we get an unlikely leak of contract info), we have no real idea of what’s going on.

Doggydogworld

Panasonic is far and away the dominant US cell producer, making ~20 GWh/year at Tesla’s GF and still ramping.

How does a CATL factory in the US “make matters worse”?

jamcl3

Does this report claim that the Russian investment made by Boris Zingarevich in EnerDel several years back has pulled out? Not surprising but this is the first I heard of it. We are still driving our Think City EVs with EnerDel batteries every day. We drove over a hundred miles just yesterday in them…

Ron M

Well the GOP fought against Obama in supporting the solar industry. China invested heavily in solar. I don’t see this administration supporting battery manufacturing or renewable energy.
The administration talks about losing manufacturing jobs to China and blames trade deficits on others. Ignoring the fact renewable energy is the future which is creating more jobs than any industry. Yet he still wants to provide additional subsides to coal and nuclear power.

Scott Franco

Obama “supported” the solar industry by giving large amounts of taxpayer money to companies designed to rip off the government like Solindra. If the government throws money at the problem, companies will arise whose business model is to get that money.

Ron M

The problem with Solyndra was it occurred when the country was loosing 600,000 jobs a month. The investment in Solyndra was 500,000. This was one of many projects invested in to get people back to work. Tesla and many other companies received loans at that time and the overall investments made billions. GOP only focused on the one failure.

Pushmi-Pullyu

Solyndra, Solyndra, Solyndra. The baseless whining from the Far Right gets pretty tiresome.

The DOE’s “green energy” loans had a 98% success rate. That’s pretty damn good compared to the average success rate for investment in startups, which is only 25% even for high-profile investment firms. (Don’t believe me? Look it up for yourself!)

The DOE’s “green energy” loan program was one of the best returns on American taxpayer money ever. It’s a scandal and a national shame that the Far Right was able to kill it off by crying about one single company which failed.

If we really want to “Make America Great Again”, then one of the very first things we should do is re-start the “green energy” loan program, and this time fund it to perhaps 5x to 10x as much as it was originally.

https://www.greentechmedia.com/articles/read/the-clean-energy-loan-program-is-already-making-money-for-taxpayers#gs.BRqIF6Y

John

What’s the Gigafactory, chopped liver? Last I heard, Tesla was an American company, building batteries in America, at a pace and volume like no one else right now.

After thumbs-ing me down, will whoever does so take the time to share what I’m missing? Thanks.

antrik

The cell production is done by Panasonic, a Japanese company…

John

Thanks.

amt

Panasonic Runs The Operations Tesla Own The Factory …That’s Why It Reads “TESLA” On batteries They Make ..

Bunny

Panasonic invested 1.8 billion of the 5 billion to build the gigafactory.

It’s not all Tesla’s . Tesla needs Panasonic much more than Panasonic needs Tesla.

Panasonic is 100 year old well run company that is diversified, if Tesla went under tomorrow, Panasonic would just go find another company to do business with for the cell part of their business.

Tesla is not yet to be proven they are, only time will tell.

antrik

I’m not so sure about that. If Panasonic decided to pull out, I’m sure LG or CATL or whoever would be glad to take over. If Tesla pulled out, Panasonic wouldn’t be able to find a replacement for the single customer buying the vast majority of their total cell production…

Will

But the batteries are made by Tesla. Cells and batteries are not the same thing.

Pushmi-Pullyu

Not sure what your point is. The battery packs are assembled by Tesla, using cells made by Panasonic.

You can say the entire pack is made in the U.S., because of course Panasonic’s factory inside Gigafactory 1 is located in the U.S.

But Panasonic is a foreign-owned company. Whether that’s good or bad is most definitely a matter of opinion. Foreign investments in U.S. manufacturing are a very good thing for the U.S. and for American workers, as well as helping insure international relations and stability… contrary to the xenophobic claims of isolationists. If the citizens of your country have a large investment in the industries of another country, then your country is unlikely to go to war with that other country!

antrik

The article complains though that even those cell makers based in the US are mostly foreign-owned… While it’s debatable whether that’s a relevant complaint, it certainly means that from the point of view of this article, Panasonic’s cell production for Tesla doesn’t really help.

Quiviran

Inside of a factory located in Nevada using mostly American workers and cell technology developed jointly with Tesla. . What’s your point, that Teslas run on foreign cooties?

antrik

That’s not my point. That’s the point of the article. Producing the cells in the US, or being based in the US, is not good enough for them. The companies must be US-owned.

Ron M

Tesla received a loan from the Obama administration which they paid years ahead of schedule. Tesla is doing a great job but this administration is doing everything they can to undermine renewable energy. Trying to freeze the CAFE standards rather than keep them where they which increases the MPG required to 52 MPG simply keeps the status quo for ICE rather than getting more EV’s on the road. This may be why legacy auto makers are so slow on scaling up battery and EV production. Right now legacy companies are only talking, talk is cheap.

Will

You are correct. Tesla takes the Panasonic cells and assembles batteries from them for their various products. Tesla IS right now the world’s largest EV battery manufacturer.

antrik

The article is about cells, not packs.

RobSez

I have a neighbor who works at the Nissan battery plant in Smyrna Tennessee. He tells me they can’t make batteries fast enough to meet demand and they are working a lot of mandatory overtime to catch up. Now, that’s just Nissan and just in the US. While the big 3 auto makers in the US whine and complain about EVs to Trump the rest of the world is moving on. Assuming Chinese BEVs will continue to be locked out of the American market, only Tesla and Nissan will be left selling BEVs in the US in five years.

Bunny

Nope, LG Chem will just keep growing like they are in Michigan with their additional manufacturing capacity.

Tesla and Nissan will be just two of yet many more manufactures building EV cars, trucks, buses, etc.

In the USA!

Will

I hope you are correct.

antrik

So the Leaf is actually production-constrained rather than demand-constrained in the US as well… That’s very interesting to hear!

Doggydogworld

The numbers don’t support that, though.

Scott Franco

Another “gotta me made in America” scare. What is Panasonic going to do, ship the gigafactory home to Japan?

Bunny

Just the profits go to Japan

Will

Cells do not have great margins so this does not worry me.

Pushmi-Pullyu

But the salaries paid to workers in Panasonic’s factory at Tesla’s Gigafactory are paid, and mostly spent, here in the U.S.A. Not in Japan. The money Panasonic pays for construction, maintenance, and keeping the lights on at the Gigafactory also go to American companies, not to Japanese ones.

The idea that foreign investment in U.S. manufacturing is “bad” for America, is an idea only “America First-ers” and xenophobes could love. It’s very demonstrably false and has been very thoroughly disproven. The facts of the matter are easily found.

Heck, even the far-right Heritage Foundation agrees:

https://www.heritage.org/report/should-americans-be-worried-about-foreign-investments-the-us

Bunny

I don’t disagree with you, but the largest problem historically in the US is the rapid short sightedness of wall street always striving for short term gains never willing to invest for the long haul.

The US has had its butt kicked in almost everything manufactured from machine tools, autos, airplanes, ship building, steel the list is endless. When the guys like Carl Icahn who has probably destroyed more companies than anybody still living, the junk bond people, I could go on and on, it’s all for short term gains with ZERO interest to long term endeavors.

EV and energy technology will just go the same way.

Back in the 80’s when Japan kicked our butts in machine tools and cars,
They had MITI helping financing investments and development, the only thing the US had was military budget. There is ZERO leadership in Washington when it comes to supporting long term industry.

It takes the people like Gene Haas in machine tools, Elon Musk in EVs and Space, the Steve Jobs and others. But as a country, the US a lot of times is their own worst enemy. We are the worlds best consumers but that’s about it.

Ron M

After WWII America produced 3/4 quarters of the world’s steel and Japan and Germany’s steel mills lay in ruins. However American steel manufacturers continued to use the open-hearth method of steel production that was already out of date. Germany though since many of the factories were destroyed began using the basic-oxygen method. The cost of building basic-oxygen furnaces were 40-50 percent less and operating costs were 25 percent less, Plus it could produce 4 times as much steel per hour. 40 tons per hour with open-hearth and 160 tons with basic-oxygen.
Anyone who owned an American made car in the 60′ 70’s has to remember what a piece of crap they were I mean you drive off the lot and in a week something like trim or a mirror would fall off. They were designed to last 3 years before major repairs were needed.

antrik

You are conflating manufacturing — which tends to be low-productivity (in terms of value created per employee) — with engineering, which tends to be high-productivity. For a strong economy, it’s best to keep the high-productivity jobs local (as Apple does), and move the low-productivity jobs off-shore (as Apple does). Trying to force low-productivity jobs to be local is *bad* economic policy.

The US economy nowadays is based chiefly on high-productivity jobs in engineering, administration, software development etc. (Silicon Valley, Wall Street); US-based manufacturing is more like a social service, providing employment opportunities for the rest of the population…

Of course it’s not always possible to separate manufacturing from engineering; and as manufacturing shifts to less manual labour and more engineering, it makes more and more sense to do it locally again… But it’s important to keep in mind that insisting on local manufacturing is not *always* the best policy.

Will

Only a small part of the GF is used to make cells. Tesla makes batteries from those cells for the Model 3 and stationary power. I think Panasonic still makes the packs for the S and X though.

Do Not Read Between The Lines

Tesla makes the packs. Imports cells for S and X, import /parts for 3 cells.

Pushmi-Pullyu

“Only a small part of the GF is used to make cells.”

Nope. Try again.

Rolando

The 1865(0) cells are imported and used for ‘S’ and “X’ packs assembled from Tesla; the 2170 cells are made from Panasonic inside GF-1 and assembled to ‘Mod-3’ packs from Tesla.

antrik

I doubt anyone outside Tesla really knows what part of the Gigafactory is actually used to make cells, vs. packs and drive units… But considering how much time certain phases of cell production take, I suspect that it actually needs more space than the other operations.

Doggydogworld

I have read Panasonic has the square part, which is a bit less than half. I agree it seems Tesla should need less space.

SJC

LG in Michigan is producing, but that is a Korean company.

Bunny

right , Tesla uses Japan batteries, Nissan also Japan, but both made on USA turf.

My point was there’s no way only Tesla and Nissan in five years.

John Doe

A cell maker or two will come to the US, when Mercedes and VW start their battery factories in the US.
They will need a fairly local source, to buy the rolls of cell material, which they use to make the pouch cells they use in their batteries.
The contracts will make it enevitable for the cell makers to start production close to the customers.
I’m sure the same will happen when Ford, GM and others start series production of batteries for their EVs.
Unless they import more finished cell units from another battery (not cell) factory.

antrik

The most important cell materials — i.e. the anode and cathode powders — are not delivered in “rolls”…

EVer

So,you have a President and a Republican Congress who are on record supporting fossil fuel friendly policies that work counter to the clean energy initiatives set forth by the Democrats before them. In fact they are working to eliminate clean energy. And, you wonder why the U.S. is falling behind…don’t vote ‘stupid.’ next time.

Rolando

The self proclaimed “biggest brained president of the planet” will soon set up hefty import tariffs on Lithium and Manganese, to protect coal barons and Big-Oil the industrial center of his supporter base.

Pushmi-Pullyu

I’m not sure I buy the premise of this article. Seems to be too much Trumpian “America Alone” attitude here.

I see nothing at all wrong with depending on battery supply from America’s long-term allies such as Japan and S. Korea.

I certainly do agree that depending on China for a battery supply would be risky and foolish. China’s competition with the U.S. in every respect — economic, political, and military — is only going to grow in the coming years and decades. It’s an unnatural state of affairs to have only one world superpower*, and China is rapidly growing to fill the vacuum left with the collapse of the Soviet Union.

*In previous centuries it was England and Spain, then Great Britain and France.

Bunny

I’m curious how many truck loads it takes to shuttle the Tesla battery modules from NV to CA weekly. That has to be a lot, and probably shipped on racks to boot, meaning the racks go back to NV empty.

Need Tesla semis doing that job ASAP.

Tesla shows 190 trucks on their DOT data , so they are burning a lot of diesel weekly.

Pushmi-Pullyu

Quite true. It’s sad that Tesla isn’t using trains to ship between Fremont and Gigafactory 1, but I guess as with other companies, they’ve found that semi trucks work better for “just in time” shipping than trains do. 🙁

I’m looking forward to when Tesla can use its own Semi Trucks to transport between Fremont and Gf1.

But I’d look forward much, much more to the USA investing in the future by revamping its railroad network to bring it into the 21st century, with high speed trains and automated, standardized routing for freight.

Bunny

+1

Doggydogworld

US freight rail network is actually quite good.

High speed rail for freight is a tough economic proposition. Costs increase significantly with speed.

Tom

We don’t need no stinkin’ electric cars. We got fossil fuels and the Koch brothers!

Lars

Challenge to Trump! Canadian steel and a!uminum are not national security concerns, Chineese batteries and the Chinese EV technology are. Stop wasting money on supporting the carriage industry (Bic coal) and retrain coal miners to make EV batteries. Make America Great Again!