In 2020, Fitch Solutions Analysts have recorded 37 projects to manufacture EV batteries and related components and materials worth $ 21.04 billion, for those projects disclosing financial details.
Projects range from the production of battery cells and packaging themselves, to anode materials and battery trays, and provide insight into which regions are most active in developing a localized supply chain and countries which are the greatest beneficiaries of these regions.
Western Europe claimed both the highest number of projects with 17 and the highest combined value with $ 9.1 billion. This gave the region a 43.5% share of total global investment in battery manufacturing projects, Fitch Reports.
Nationally, Germany leads the region with 10 out of 17 registered projects. The largest project in Germany is SVOLT’s $ 2 billion battery cell plant with a capacity of 24 GWh per year.
This activity in Germany reflects the desire of the country’s main car manufacturers to invest heavily in the manufacture of electric vehicles in their original factories. Volkswagen, Daimler and BMW are all at the table with their own plans to produce battery packs showing the more active role of automakers in the supply chain, Fitch Remarks.
In emerging Europe, projects are dominated by Hungary and Poland and are mainly located in the battery components segment, supplying existing facilities in these countries. This is a testament to the strength of these two countries as automotive production sites in general, Fitch said, as well as their ability to move up the value chain with high-tech products.
South Korean company SK Innovation, for example, plans to build its third factory in Hungary, which has become the company’s European base.
While much of the investment in the regions is driven by a desire to reduce reliance on a handful of markets, notably China, for the supply of batteries and related components, plans for the Asia region show that China is still an investment target due to being the world‘s largest autonomous market for electric vehicles.
China represented three of the eight projects monitored in Asia, Fitch reports, with a combined value of $ 2.6 billion, the largest being a $ 1.2 billion joint venture between Geely and CATL for a new battery plant. CATL was also behind the largest investment in the Asia region, with $ 5 billion for a new battery plant in Indonesia.
The company also agreed that 60% of the nickel used in the production of batteries at the plant will come locally, which informs the analyst that Indonesia has the potential to become a key player in the development of a chain of battery supply in South East Asia. .
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