Interview Synopsis

North America EV battery industry update

  • Private Equity
  • Industrials
  • North America

The OEM that controls the natural resources needed to make electric vehicle (EV) batteries is most likely “to win” the sustainability race, according to an expert we spoke to recently.

OEMs in a race to control EV battery materials

In an Interview with Third Bridge Forum, the specialist said EV battery development has “crossed a threshold of momentum” that is unlikely to stop. However, while supply chains and sources of lithium-ion are improving, the specialist told us on a vehicle basis “no EVs are profitable” without subsidies from governments. EV batteries are currently too heavy and expensive, we were told, and that OEMs will not make money on EVs until cost reductions and battery improvements are made. 

If OEMs manufacturing EVs want to create a sustainable business over the next 10-30 years, the specialist said they will need to control key battery materials such as lithium, nickel, cobalt, aluminium and manganese. They told us Toyota has been buying lithium mines in South America over the past 10-years in preparation for this. 

We were also told that the EV market is forecasted to grow to USD 216.5bn by 2028, with a growth rate of 19% over the next five-years. The specialist mentioned five companies that are heavily involved in the global EV battery market and are predominantly based in Asia – with one from China described as “the real deal”.

The interview also revealed insights into solid-state batteries, which we were told are likely to be operational by 2025. The specialist predicts the technology should help double the energy density of batteries to 400 watt-hours per kilogram – a “significant” accomplishment in their opinion. And while the specialist reiterated that EV batteries are currently too expensive to be profitable, they hypothesised that if gasoline hits USD 7-8 a gallon, that idea might very well change. 

To access all the human insights in Third Bridge Forum’s North America EV Battery Industry Update – 2022 Outlook Interview, click here to view the full transcript.

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The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.

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