US & South Korean Companies To Onshore More Battery Production To US
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The dominance of China in the EV battery supply chain has raised concerns about the geopolitical risks associated with the reliance on one country for essential minerals and battery technology. As Chinese companies control over 70% of lithium-ion battery manufacturing and nearly all stages of the EV battery supply chain, this reliance on China puts the United States at a disadvantage in promoting clean energy and reducing carbon emissions. It’s something that liberal democracies need to do, but if not done carefully, it can put us in a position where illiberal authoritarian states can call the shots.
To reduce this dependency, the United States needs to focus on expanding its domestic production capacity for EV batteries. This will not only create jobs but also lead to the development of a secure and sustainable supply chain. By increasing onshore production of EV batteries, the United States can also decrease the geopolitical risks associated with the reliance on China for minerals such as lithium, cobalt, nickel, and manganese, affecting many industries outside of batteries and cleantech.
And this isn’t just an academic concern. In the past, China has used its control over these minerals to gain leverage in geopolitical disputes. For instance, China withheld shipments of rare earth minerals to Japan during a dispute over islands in the East China Sea. Similarly, in 2021, China halted exports of rare earth minerals to the United States, sparking concerns for the US economic and military security.
Therefore, onshore production of EV batteries will not only decrease reliance on China and mitigate geopolitical risks but also lead to the development of a cleaner, greener, and more sustainable future for the United States.
But, getting there isn’t easy, and it’s not something the United States and allies can do on their own. It’s going to take a cooperative approach to technology and resources, with some countries having more of one than the other.
The President of KIAT (Korean Institute for Advancement of Technology), Vice Chairman of KBIA (Korean Battery Industry Association), President of KETI (Korean Electronics Technology Institute), and Executive Director of NAATBatt have signed a Memorandum of Understanding (MoU). This MoU aims to facilitate the onshoring of Korean battery manufacturers in the United States.
The signing took place at the Waldorf Astoria in Washington, DC, in conjunction with the intergovernmental meeting between US President Biden and South Korean President Yoon Suk Ye. QAD, a member of the NAATBatt Association, played a pivotal role in the MoU. QAD’s Head of EV and Mobility, Andreas Bareid, serves as a Co-Chairman of the NAATBatt Onshoring Committee and Board Member.
“Korean companies today are world leading experts within manufacturing of lithium based batteries,” said James Greenberger, founder and executive director of NAATBatt. “If we want to build a vibrant North American supply chain for lithium based batteries as quickly as possible, we need to use the best available manufacturing technology to achieve this. Today, this technology is largely with Korean companies. Hence we should integrate these Korean experts and companies to be part of that supply chain and the North American business community.”
The onshoring of Korean battery manufacturers in the US will help the country reduce its dependence on foreign sources of EV batteries and the risks that come with it. This partnership will also promote job creation, economic growth, and sustainable and secure supply chains. The MoU reflects the willingness of both governments to work closely together to strengthen the USA’s domestic production capabilities in the green energy sector.
The NAATBatt (National Alliance for Advanced Technology Batteries) Onshoring Committee is one of the association’s fastest-growing committees. Its primary focus is on connecting foreign battery industry associations with NAATBatt members and supporting their members in establishing business relationships with the organization. The committee’s main objective is to provide access to NAATBatt’s valuable resources, thus ensuring integration and sharing of knowledge.
“We are excited to build the bridge between the knowledgeable Korean battery companies and the US, for all parts of the battery supply chain,” said Bareid. “Working together, through joint ventures, partnerships and business relations between our members, is the only way we can achieve rapid speed to benefit. To further ensure the adoption of EV, it is critical for onshoring companies to establish production and produce the yield envisaged and required by the Inflation Reduction Act. QAD supports the incoming onshoring companies with rapid speed to establishment and scale to manage their supply chain.”
In preparation for the signing of the Memorandum of Understanding (MoU) to facilitate the onshoring of Korean battery manufacturers in the United States, QAD sponsored a dinner at the Conrad Washington DC Hotel. The dinner was hosted by NAATBatt, and attendees included members of both Korean and US Battery Associations, government officials, and representatives from several key US OEMs, battery makers, and suppliers.
Among the attendees were representatives from GM, Airgas, Amphenol, P3, Polaris, and Clarios. This event provided an opportunity for those involved to network, exchange ideas, and establish relationships that will promote job creation, economic growth, and secure and sustainable supply chains in the green energy sector.
QAD’s involvement in sponsoring the dinner underscores its commitment to advancing the development of the EV battery industry in the US. As one of the members of the NAATBatt Association, QAD has played a pivotal role in promoting onshoring efforts and establishing relationships between US companies and their Asian counterparts.
Overall, the dinner hosted by NAATBatt, and sponsored by QAD, was an essential step towards establishing a robust and environmentally sustainable EV battery industry in the United States.
While Korean companies tend to have the technology, the United States has a lot of raw materials that could be brought into the picture, along with those of allies in Canada, Australia, and Europe. This puts Korea in a good position to play a pivotal role in helping an alliance of liberal democracies maintain their position in the global automotive, clean technology, and clean energy markets. By keeping allies working together, QAD and its partners are not only helping improve access to battery technology, but also helping keep freedom alive.
Featured image: QAD’s Andreas Bareid, NAATBatt’s James Greenberger and others at the signing of the Memorandum of Understanding between the US and South Korea. Image provided by QAD.
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