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The UK government may struggle to meet its ambitious 10-point sustainability plan without investment in and the construction of home-grown battery capacity, causing unease within the industry.
The 10-point plan announced by the prime minister aims to help achieve the UK's carbon emissions legally binding reduction goal of the country becoming carbon neutral, or having net zero carbon emissions, by 2050.
The UK government is targeting the end of sales of new gasoline and diesel cars and vans by 2030, 10 years earlier than planned -- by backing car manufacturing bases in the West Midlands, the Northeast and North Wales.
The chief technical officer of Ireland-based investor Techmet, Simon Gardner-Bond, said the UK government was "highly unlikely" to meet the new EV target announced Nov. 18.
There is an overriding consensus that the plan is political rhetoric, lacking real investment to make it a success.
One senior investor told S&P Global Platts: "Net zero is a buzzword in the financial markets and anything with an ESG-angle is aggressively marketed. This happens almost regardless of whether the company really has any meaningful solutions to the net zero transition...transportation is a major source of CO2 emissions at [circa]20%. The solution, EVs. They really could be a silver bullet. To maximize penetration, we need battery capacity in the UK."
One of the continued sticking points was the lack of investment by the government in battery cell manufacturing capacity.
Britishvolt Chief Strategy Officer Isobel Sheldon told S&P Global Platts the ambitious targets set out would be a "enormous challenge for the automotive industry to achieve."
Britishvolt is aiming to build the UK's first battery gigafactory, with first run scheduled for 2023.
EV waiting lists
"One point that is seemingly being missed in any coverage of the sector is the fact that there are six-to-nine-month waiting lists for many EV models in the UK and right across Europe. So, this is a real demonstration of there already being a shortage of battery capacity. The fact the we are now seeing dedicated BEV vehicle platforms coming to market, and they are selling out 12 months' worth of production capacity as soon as the pre-order books are opened, [underscores] that the car buying public have been waiting for these vehicles to arrive. The European automotive industry has vastly underestimated this demand and their product-cycle plans are left playing catch up," Sheldon said.
The strategist was quick to note that the government needed to step up "and play its part."
In a bid to increase visibility on the subject Sheldon said that the company was aiming to create the UK Battery Alliance, a consortium made up of all aspects of the EV supply chain.
This would play a similar role as the European Battery Alliance, which was established in 2017 to develop a globally competitive, innovative and sustainable European battery value chain.
The EU could produce enough battery cells to meet the needs of its EV industry by 2025, European Commission vice president Maros Sefcovic said Nov. 24.
"I am aware that this is a big ask. If we do manage to achieve this, it will in large part be thanks to the Battery Alliance; a truly collaborative effort requiring the full commitment of all involved," he added.
OUTLOOK BLEAK WITHOUT MANUFACTURING
Back in September, Cornish Lithium CEO and founder Jeremy Wrathall aired similar concerns, saying that the UK government needed to "step up" and give a boost to the UK's EV gigaplant ambitions, otherwise the country faced a "bleak" EV manufacturing future.
Wrathall said the UK did not want to lose anymore auto-related jobs. On the subject of local supply chains, he said that it would be a good move to have a battery-cell factory in Cornwall, to help process the developer's lithium.
He said that the government needed to step up even in these "very challenging times." So far his company has received part funding from the UK government, but there are industry concerns that not enough is being done to secure manufacturing in the UK.
UK EV MARKET GROWING
Senior analyst, future energy metals at S&P Global Market Intelligence, Alice Lu, said MI expected the UK to become the fourth-largest market for passenger plug-in electric vehicles, or PEVs, this year, after China, the EU and the US.
UK's passenger PEV sales are forecast to increase to 146,000 units this year, and to 315,000 units by 2024.
"There have been increasing investments in vehicle battery capacity in the US and Europe to meet the growth in regional PEV production...Local cell sourcing could help to mitigate trade and shipment risks and save on shipping and tariff costs. However, challenges persist including access to battery production know-how, sourcing battery raw material and controlling production costs," Lu added.