Europe and EV battery production autonomy: a race against time?
Europe strives for self-sufficiency in EV battery production, but the reality is far more complex. This push is driven by the need for decarbonization and the phase-out of internal combustion engines by 2035. Batteries are essential in the fight against global warming, with battery-electric vehicles playing a pivotal role in driving both demand and innovation in the sector.
Currently, Europe’s production capacity stands at approximately 150 GWh per year, with projections indicating a significant rise to 0.86–1.2 TWh per year by 2030. To put this into perspective, 1 TWh could power 1.5 to 2 million EVs. While this growth is substantial, the question remains: is it enough to eliminate reliance on imports?
A study published in Nature Energy suggests that Europe’s production capacity may struggle to keep up. Only 39% of the analyzed scenarios foresee a production capacity sufficient to fully meet domestic demand. To bridge the gap, annual production growth would need to reach an ambitious 31–68%, a pace that presents significant challenges.
Even under the most optimistic projections, only half of the scenarios indicate that Europe could meet 80–100% of its demand by 2030. There is, however, some positive momentum: European companies are expected to increase their share of domestic production from the current 35% to 55%, reducing dependence on Chinese manufacturers like CATL and BYD.
The challenge extends beyond production capacity to the supply of raw materials. Demand for lithium, nickel, and graphite is projected to increase up to 15 times by 2035. While the industry is turning to battery recycling as a solution, its impact will remain limited until the early 2030s, as the number of end-of-life batteries will still be too low to provide a substantial share of supply. In the meantime, Europe will continue to rely on lithium imports from Australia and Chile, while cobalt will primarily come from the Democratic Republic of Congo.
Nearly half of the analyzed scenarios highlight the real risk of falling short of the 90% self-sufficiency target, with potential production deficits emerging as early as 2025.
The race is on, and Europe faces a formidable challenge that demands targeted investments and the development of a fully integrated supply chain. Without these efforts, the transition to electric mobility will continue at an inadequate pace, leaving the continent vulnerable to external dependencies.
