Leading battery manufacturers warn of possible shortage

Leading battery manufacturers and procurement managers warned of a pending battery shortage in Europe, mainly due to the boom of wireless technology and the planned electrification campaigns by the automobile industry.

Additionally, battery production mainly lies in the hands of a select few suppliers, which are apparently not always playing fair. Existing contracts are said to be “not worth the paper they are printed on”, according to an unnamed procurement manager quoted by German Wirtschaftswoche. He eleborated, explaining that suppliers like LG and Samsung were currently busy cancelling and delaying existing orders to smaller companies, and instead making fast sales in China.

Other sources in the article included Michael Ziegler, senior purchasing manager at Stihl, and Sven Bauer, CEO of the largest German battery producer BMZ. Both noted that the potential bottle-neck of Lithium-ion batteries is due to the quickly growing demand in businesses including smartphones and laptops, but also e-bikes, pedal electric bikes, as well as other wireless products, such as handheld vacuum cleaners or wireless drills.

This begs the question of what is going to happen in one or two years time, when vehicle producers start their announced big expansion offensives of EVs. Volkswagen alone is going to be using approximately a quarter of the current global lithium-ion batteries produced by next year. An electric vehicle tends to use much more batteries than consumer products, such as, for example, a smartphone, in this case at a ratio of 8,000 to 1.

While battery producers around the globe are increasing their production capacities, it won’t be enough. Furthermore, 90% of the worlds production facilities for batteries belong to a small circle of Asian firms, including Panasonic/Sanyo, Sony, LG Chem, Samsung SDI, as well as  a few Chinese firms. If the world is going to continue to develop and consume technology at the current rate, supply lines will have to be adapted and expanded to meet the demand.

wiwo.de (in German)