Without raw materials by 2030, our European battery factories will be useless

The European Union's Court of Auditors warns of bleak prospects for the EU to become the world leader in battery production, despite commitments to electric mobility.

Although the theoretical end of the combustion engine in new cars by 2035 and announcements of new battery factories across Europe, such as Sagunto, are good news for jobs, the Court of Auditors points out that the EU's chances of taking the world lead in this field are not favourable.

Building factories to manufacture batteries is not enough, as it is also essential to ensure their supply. This is where the main problem lies. According to a recent report by the European Commission, the availability of raw materials, the increase in the costs of these raw materials and energy, as well as global competition, could jeopardize Europe's competitiveness.

Our dependence on raw materials in the hands of third countries could go further

Our dependence on raw materials from third countries could worsen. If we achieve our goal of selling only electric cars by 2035, this will be done mainly by importing batteries, which could harm European industry, according to the observations of Annemie Turtelboom.

Even more worrying, there is a risk of replacing our dependence on fossil fuels supplied by third countries with a dependence on raw materials. Annemie Turtelboom stresses that Europe must not find itself in a situation of dependence similar to that which we have experienced with natural gas, as this would jeopardize its economic sovereignty.

Raw nickel.

China currently holds a dominant position in the world production of batteries for electric cars, with a market share of 76%, while the European Union represents only 7% of this production, which confirms an existing dependency.

As for the raw materials needed to manufacture batteries, Europe is dependent on a small group of countries for its supply of cobalt, nickel, lithium, manganese and natural graphite, which are key elements. About 87% of raw lithium is imported from Australia, 80% of manganese comes from South Africa and Gabon, 68% of cobalt is imported from the Democratic Republic of Congo, and 40% of natural graphite comes from China.

Lithium brut.

The Court of Auditors highlights that not only is there no free trade agreement with these countries, which could facilitate supply, but some of these countries also present geopolitical risks which could compromise supply.

A future shortage of raw materials

Adding to these concerns, the Court of Auditors of the European Union predicts a future global shortage of raw materials essential for European battery production. If we depend on external suppliers and the shortage materializes, it will mean that we will simply have to buy electric cars from those who have these supplies, which would jeopardize the achievement of our 2035 target.

According to the report by the EU Court of Auditors, forecasts by the European Commission's Research Department (JRC) indicate that the global shortage will have a significant impact in 2030, precisely when the bulk of the production capacity of EU batteries will be operational. This prediction is also in line with forecasts by the International Energy Agency (IEA), which says that the global production capacity of copper, cobalt and lithium in 2030 will not be enough to meet global demand.

Unfortunately, these factors will not bring down the prices of electric cars, quite the contrary. Production costs will increase due to the high price of raw materials, which could make electric cars unaffordable for many motorists. This would lead to a drop in demand for electric vehicles and a lack of economic interest in investing in electric vehicle manufacturing facilities.

In summary, the report of the Court of Auditors of the EU presents a rather pessimistic outlook. According to this European institution, the future of the electric car in Europe is in danger if the situation continues like this.