UK must accelerate Gigafactory development to save car industry

Current plans for UK Gigafactories points to a shortfall of more than 95GWh in battery production by 2040, a report has warned.

The UK must rapidly accelerate the establishment of Gigafactories and new battery technology development or risk losing domestic car production altogether, according to a report published today by sustainable manufacturing consultancy HSSMI.

The majority of global battery production - roughly 70 per cent – is currently in Asia, thanks to ready accessibility to natural resources; government-driven support for high-volume manufacturing, and surging local demand for electric vehicles.

HSSMI's report warns that the UK – as well as Europe and the US – risk being left behind by other countries that are making rapid headway towards electrification.

“Electrification is increasing demand for the battery cells and packs powering electric vehicles,” said Axel Bindel, executive director, HSSMI. “The UK in particular is at a pivotal moment. By 2040, there will be a need for 140GWh in battery cell capacity; equivalent to five Gigafactories.

“Currently, however, there is only 3GWh of production in the UK and, by 2030, just a further 45GWh planned, leaving a major gap – over 95GWh – between the rate of battery plant establishment, planning and the forecasted demand.”

The UK faces key challenges, the report says, including lack of skilled technicians on cell manufacturing processes and availability of critical raw materials, as well as high production costs.

It adds that investing in more battery plants and bringing them as close as possible to car production – reducing supply chain challenges – can alleviate many of these issues while acknowledging that the government is starting to make funds available for the industry, with more collaboration potentially needed to steer the country to success.

“Typically, it could take a Gigafactory up to five years from an initial idea to become fully operational. Demand for cell manufacturing, however, is expected to surge in the next four to five years. Our expertise in cell design, manufacture and commercialisation can dramatically speed this up,” said Robin Foster, battery solutions lead, HSSMI.

“We can’t focus just on Gigafactory creation without being strategic about new technologies,” added Foster. “In parallel, the UK must exploit and commercialise the wealth of new battery technology developed locally. The typical time for new technology to become commercially ready can be 10 years from lab to high-volume production. Engagement with a scale-up specialist can provide feedback early on for commercial viability, disrupting the traditional linear development programme and speeding up the time to market.”

The report has laid out five key steps for the UK industry to accelerate Gigafactory creation:

  1. Make the most of what exists already: developing products that can fit into existing production facilities or use off-the-shelf machines will enable easier uptake of new cell technology. Where new processes are created, a further development programme will be required for the manufacturing machines, potentially delaying commercialisation.
  2. Know your target market: the design of a new battery must be focused on all the needs of the application. While development may target one parameter, e.g. high capacity chemistry, application requirements for other aspects (cell size, electrode specification) can lead to late design changes, extra costs through revalidation trials, equipment re-tooling or replacement.
  3. Understand the costs involved: materials used in lithium-ion cells are expensive, so high process yields are critical. Taking steps towards optimised production early in product development is key to keeping lab-to-production timescales minimal and reduce waste material costs during upscaling activities.
  4. Conduct manufacturing feasibility studies early: feasiblity studies are important to understand Gigafactory-specific characteristics, facility requirements (size, utilities, labour) and how the product selected for manufacture influences them. Unique cell design features that increase production time or complexity could lead to non-profitable products. Early studies facilitate parallel development of the product for performance and manufacture to ensure commercial viability.
  5. Engage with scale-up specialists: such specialists can help address many challenges swiftly, saving time and money, through leveraging existing supplier relationships, equipment knowledge, facility design and scale-up experience.

Trends are already emerging with automotive OEMs partnering with cell manufacturers and entering into joint ventures to secure battery cell supply. Staying close to cell manufacturers allows automotive OEMs to eliminate supply chain risks, such as concerns about transporting dangerous goods and longevity of supply, and use the opportunity to co-develop battery cells, packs and EVs. HSSMI believes it is imperative for the UK to attract and develop high volume cell manufacturing capability to decrease the temptation for domestic automotive OEMs to seek opportunities elsewhere.

David Stewart, engineering director, HSSMI added: “At the moment, the Envision AESC facility in Sunderland is the only UK facility manufacturing lithium-ion cells at scale (2-3GWh). AMTE Power and BritishVolt have both announced plans for UK-based Gigafactories, which will help supply local products to the UK automotive sector.

“Nonetheless, further investment into the UK automotive industry is crucial, as it has been plummeting since 2013 and in 2018 inwards investment amounted to only £0.59 billion.

“Government-backed bodies such as the Advanced Propulsion Centre and the Faraday Institution are continuously working to accelerate battery technology by promoting and catalysing innovation and collaboration between manufacturers, technology providers, automotive OEMs, research organisations, and academics, through various funding opportunities.”

In related news today, it was reported by Forbes that Gigafactory pioneer Tesla saw its shares fall again in reaction to the news coming out of China that its electric car sales slumped in April. According to Global Times, a government-affiliated news outlet which cited China Passenger Car Association data, Tesla's sales plummeted 27 per cent to 25,845 new vehicles - a decline of nearly 10,000 units since March.

Separately, Reuters reported that the company has decided not to purchase land adjacent to its Shanghai Gigafactory plant to create a new facility dedicated to building Tesla Model 3 cars for export to markets including the US, which imposes a 25 per cent tariff on all vehicles produced in China.

Tesla has been suffering PR issues in China of late and was criticised as “arrogant” over its handling of a well-publicised customer complaint about a braking issue with her vehicle. Chinese government officials also raised concerns that cameras on Tesla vehicles created a security risk, resulting in all Tesla cars now being banned from Chinese military facilities. Elon Musk has assured Chinese officials that the cameras are not activated outside of North America to randomly collect data.

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