Britain is battling to match China’s strength in battery manufacturing, which currently pumps out car batteries for Tesla, the world’s leading electric vehicle company valued at $1trillion (£750billion). Tesla’s factory in Shanghai now produces more cars than the Tesla plant in California, and many of the batteries that drive Tesla cars are Chinese-made. And the minerals that power the batteries are also mainly refined and mined by Chinese companies too.
Meanwhile in Britain, Britishvolt, a start-up battery manufacturer, has recently submitted plans for a £2.6billion Gigafactory in Northumberland – on the site of the former Blyth Power Station.
Britishvolt said it will produce 300,000 lithium-ion battery packs each year, which will be used to supply the UK automotive industry.
It is now reportedly in talks with some of the world’s largest car manufacturers.
This comes as the sector has seen a move towards vertical integration.
Vertical integration refers to the process of one company controlling a number of steps along a supply chain, including guaranteeing supply and improving transparency in some cases.
But, as companies battle for the top spot, it seems as though China is in the best position in what The Guardian have called the “battery arms race”.
China has the largest market for EVs in the world, with total sales of around 1.3million vehicles last year.
This was more than 40 percent of sales worldwide.
And the Chinese battery-maker CATL controls around 30 percent of the whole world’s EV market.
Cobalt (a mineral that improves the stability of lithium-ion batteries) specialist suppliers Darton Commodities has estimated Chinese refineries supplied around 85 percent of the world’s battery-ready cobalt.
But some car and battery manufacturers are starting to reduce the amount of cobalt in their batteries.
And, in good news for Britain, efforts are being made to push back against China’s dominance in the battery market.
The Democratic Republic of Congo (DRC) , where Chinese companies are mining for cobalt, has recently announced a review of some of the largest mining contracts, including the $6.2billion (£4.5billion) deal which gave the Chinese consortium majority control over Sicomines, a mining company in the DRC, back in 2007.
The country’s president, Félix Tshisekedi, said: “People come to Congo empty handed and when they leave they are billionaires, but we remain poor.”
Now, British companies are hoping to take advantage as they enter into the battery arms race.
The Prime Minister signalled “a major vote of confidence” in post-Brexit Britain when plans for an electric vehicle hub to be set up in Sunderland by 2024, including £1 billion in investment from Nissan and battery-maker Envision, were announced.
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But China even has a hand in this – as Envision is a Chinese company and will run the battery plant.
And while the Government has stressed a desire to bolster up its elective vehicle industry, experts have suggested the UK lags behind.
Andy Leyland, head of strategic advisory at consultancy Benchmark Mineral Intelligence, said: “The UK Government focused a lot on encouraging research, and building a battery testing hub. When it comes to the big commercialised actions, we’re quite a bit behind continental Europe, and very far behind Asia.”