The Success of Electric Vehicles Hinges on Batteries

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Electric vehicles (EVs) currently make up just 1% of the global automobile market, but the number is expected to increase rapidly. Within four years, analysts predict that one in four cars in china and 40% of those in Germany will be electric. In the US., as in other countries, sales of EVs have soared in 2021, breaking records even during a global chip shortage and ongoing supply issues. Experts expect up to 230 million EVs in use globally by the end of the decade, accounting for 12% of all cars.

Tesla is far and away from the EV market leader, and the company is currently worth more than Ford and GM combined. Its rivals, through, have plans to catch up- Ford is investing $7 billion in four new plants in Kentucky to pump out 1 million cars a year by 2025, and GM has announced that it will completely phase out internal combustion engines by 2035.

With revolutionary technology come revolutionary challenges, and those mostly pertain to EVs' central feature: the battery. These challenges will define the shape of the industry both in the near soon- by determining the scope and speed of consumer adoption- and in the far future, by bringing environmental threats and manufacturing challenges that will change the way the industry operates.

Charging Limitation

The logistical limitations of charging EV batteries mean that right now, the car tend to be a niche products bought by wealthy suburbanites who can set up personal charging stations in their garages or who have access to charging stations at their workplaces. If EVs are to evolve into a mass market product, they'll need a national network of stations to counter the top reason people hesitate to buy them: range anxiety or the fear that the cars will ran out of juice on a long drive and have nowhere to charge.

Analysts note that the industry can't take off until this network exists, but car manufactures currently face a chicken -or-egg conundrum: Customers are hesitant to buy EVs without enough charging stations, but companies are hesitant to build stations without enough customers. For this reason, investment in such a network will likely be government-led.

Environmental Problems

EVs produce no emission while being driven, but the mining, manufacturing and disposal of batteries threaten to be major environmental concerns in the coming years. Materials in lithium-ion batteries are toxic and often flammable-fires sparked by these batteries are not uncommon in municipal waste facilities. Recycling will likely be a significant piece of the solution. Several companies have sprung up to redirect materials from end-of-life batteries into new batteries, aiming for a "circular economy". This process is called "urban mining", and many hope it will become a central part of the manufacturing process.

Recycling promises to protect the Earth from battery waste and help with another long-term problem the industry faces: shortages of raw materials for manufacturing.

Supply Chain Issues

The materials needed to make the battery are expensive and in limited supply. Recycling will help manufacture maintain access to these materials and lower costs- sourcing materials from used products is often easier than extracting them from the ground. It will become even more important as global demand for raw material skyrockets and companies without their supplies struggle to source them. Some analysts forecast that demand for battery materials will exceed supply in less than three years, leading to a crunch that might echo the oil embargo of the 1970s that sent prices soaring. Exacerbating this would be the fact that such a crunch would be prolonged- while it's easy to quickly "turn on" oil spigots, it's not easy to find, mine, and extract cobalt, nickel, or any of the other rare metals used in the manufacture of EV batteries.

For this reason, several countries, including china, are developing robust recycling programs. US officials warn that he country risks falling behind in the coming decade without investment in such a program.

US. Governmental Response

The Biden administration has signaled support for the EV industry, setting a goal for all new cars to be electric by 2035. It has earmarked money for upgrades to the country ageing electrical grid and the building of a national charging network. It's also put some money aside to develop a battery recycling program.

Critics say the budget doesn't go far enough, but they acknowledge its's a decent start. Naturally, any government efforts can only ever be a start- the rest will be up to car manufactures, who are, prompted by unleashed consumer demand, highly incentivized to meet the challenges facing the industry.

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