CHINA’S SUPPLY CHAIN DOMINANCE
China’s dominance in the battery supply chain is the result of a decades-long push by its government.
Its factories produce over three-quarters of batteries sold globally, at prices about 20 per cent lower than North American manufacturers, according to the International Energy Agency.
The lithium-ion batteries power everything from smartphones and drones to electric vehicles (EVs).
“China is around 10 years ahead of Europe and North America in developing those battery supply chains and EV production,” said Daniel Harrison, an analyst at automotive publisher Ultima Media.
The country’s advantage extends from refining minerals to battery-cell assembly.
China’s grip on the sector has raised alarm in Washington, especially after Beijing introduced new export controls in April this year, restricting seven rare-earth elements, and expanded them further in October to include technologies for mining, processing and magnets.
“They really dominate the supply chain end-to-end,” said Jake Higdon, an energy transition fellow at California Forward, a non-profit organisation which supports the state’s economic growth.
“Upstream materials like graphite that go into batteries – that’s dominated by China. Downstream manufacturing, cells, packs, the electric vehicles that the batteries are going into – China is the dominant player on those as well.”
In a tentative deal last month, Washington agreed not to impose its threatened 100 per cent tariffs on Chinese imports, while Beijing committed to hold off on its export restrictions.
