Global Shifts in EV Production and Supply Chains
Global Shifts in Electric Vehicle Production and Supply Chains
In a strategic move, China is investing over $2 billion in establishing a battery supply chain in Morocco to support Europe's electric vehicle (EV) industry. The initiative comes at a time when Europe is struggling to develop its own battery industry and faces the dominance of China in global battery production and raw materials such as lithium, nickel, and cobalt.
Stora Enso Oyj plans to invest €100 million in wood-based batteries using lignin, with the aim of reducing Europe's dependence on Chinese imports. The Finnish forestry company is working on a sustainable material for anodes in batteries, although mass-scale production is still a few years away.
Morocco, with its rich phosphate resources crucial for LFP cells, is strategically located near Europe and benefits from free trade with the US. CNGR Advanced Material Co. and African private investment fund Al Mada aim to commence the production of battery materials at a new site in Jorf Lasfar by 2025.
In a separate development, Jaguar Land Rover is set to reintroduce the Freelander as an EV for the Chinese market through a partnership with Chery Automobile. This move is designed to capture a portion of the world's largest auto market, where local brands are introducing feature-rich electric and hybrid vehicles to meet the increasing demand.
Key Takeaways
- China's investment in a battery supply chain in Morocco aims to support Europe's EV industry, with CNGR Advanced Material Co. pledging over $2 billion.
- Stora Enso's €100 million investment in wood-based batteries using lignin is intended to diminish reliance on Chinese imports.
- Jaguar Land Rover's reintroduction of the Freelander as an EV for the Chinese market signals an effort to tap into the growing demand for electric vehicles in the world's largest auto market.
Analysis
This strategic move by China to establish an EV battery supply chain in Morocco reinforces its dominance in the global battery production market. The investment is likely to have a negative impact on European automakers, who are grappling with the development of their own battery industries. Meanwhile, Morocco stands to benefit from increased foreign investment and its advantageous location. In response, Stora Enso's foray into wood-based batteries could diversify Europe's supply chain and reduce reliance on Chinese imports. The joint venture between Jaguar Land Rover and Chery Automobile exemplifies the intensifying competition in China's rapidly expanding electric vehicle market. Overall, these shifts underscore the global race for battery materials and supply chain control in the rapidly electrifying automotive industry.
Did You Know?
- Battery Supply Chain in Morocco by China's CNGR: CNGR Advanced Material Co., a leading Chinese battery materials manufacturer, is investing over $2 billion to establish a battery supply chain in Morocco. This strategic move aims to support Europe's electric vehicle (EV) industry, as Europe faces challenges in creating its own battery production industry. Morocco's rich phosphate resources, strategic location, and free trade agreement with the US make it an attractive destination for this investment. The new site in Jorf Lasfar is expected to begin producing battery materials by 2025.
- Wood-based Batteries by Stora Enso Oyj: Stora Enso Oyj, a Finnish forestry company, announced a €100 million investment in wood-based batteries using lignin. The company is developing lignin-based anodes as a sustainable alternative to non-renewable components in batteries, aiming to reduce Europe's dependence on Chinese imports. Mass-scale production of these wood-based batteries is still several years away.
- Joint Venture Between Jaguar Land Rover and Chery Automobile: Jaguar Land Rover has partnered with Chery Automobile to revive the Freelander as an electric vehicle (EV) specifically for the Chinese market. This collaboration is a strategic move to capture a share of the world's largest auto market, where local brands are introducing feature-rich electric and hybrid vehicles to meet growing demand.