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02

Bringing the supply chain home

A resilient supply chain, talent and speed to market are critical

01

Can Europe’s battery makers respond to demand?

02

Bringing the supply chain home

03

The battery evolution

04

Risks loom on the horizon

The Covid-19 pandemic has accelerated the trend of moving supply chains closer to destination markets in Europe. This re-shoring and near-shoring process shortens supply chains, which increases resilience and speed to market, and lowers the carbon footprint.

Eight in 10 respondents to our survey say they are either currently in the process of bringing the supply chain closer, or are planning to do so in the next 12 months.

Re-shoring is a priority for many

Which of the following activities is your company currently doing or planning to do over the next 12 months?

Additive manufacturing and technology partnerships will be key to this re-shoring effort by helping to bring manufacture of specialty components closer to home, and 79% are building partnerships with a technology specialist provider to enable this, or with an end-customer to secure off-take. End-customers such as carmaker Volvo are ready to partner up. In June, Volvo secured future supply through a joint venture with Swedish battery start-up Northvolt.9

“You can’t just buy on the general market. We want to start from zero. The best way to build up this knowhow is . . . with very tight cooperation with a partner,” Volvo Chief Executive Hakan Samuelsson told the Financial Times.

Innovation is on the horizon

With a better grasp of the supply chain also comes the ability to innovate. Additive manufacturing gives manufacturers flexibility, which makes it important for the next generation of batteries, such as solid-state batteries.

Solid-state batteries have a solid electrolyte (rather than a gel-like substance) at their centre. This allows them to store a greater charge more quickly, which could double the range of EVs.

Pilots of solid-state batteries are planned for the first half of the decade.10

The majority of respondents are busy innovating

Which of the following activities is your company currently doing or planning to do over the next 12 months?

We're in a technology race against Chinese giants. Europe needs to be able to keep up and develop a product that has the right performance in terms of energy density and cost-competitiveness.

FRANCISCO CARRANZA Vice President Sales and Marketing, Automotive Cells Company (ACC)

The talent quest is set to get harder

Another benefit of re-shoring is that it helps to develop a skilled local workforce capable of innovating.

Fifty-eight percent of respondents say the European workforce already has a good or fairly good level of skills to drive innovation. And only 16% say they need to recruit from abroad. But with new gigafactories set to open across Europe, the demand for talent is likely to increase.

“There are so many companies that are establishing operations now, and it's very hard to recruit the right talent if they’re already working within the industry,” says Francisco Carranza, Vice President Sales and Marketing at Automotive Cells Company (ACC), which is currently planning to develop gigafactories in Douvrin, France, and Kaiserslautern, Germany.

“So we need to work very heavily with universities and engineering schools – try to help them with the transition, so we get more people with the right expertise and the right motivations going into the electrical and chemical side of the industry after graduation.”

Europe currently has a good level of skills to drive battery innovation

To what extent do you believe the following skills and specialisations are available to drive battery innovation in Europe?

In Section 3, read more about bringing the supply chain home

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