Where are lithium batteries assembled?

In this article, we discuss lithium battery production by country. If you want to read about some top countries in terms of lithium battery production, go directly to Lithium Battery Production by Country: Top 5 Countries.

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Several countries are key players in the battery tech manufacturing industry and claim a major share of the global market. These countries are home to large battery manufacturers, and often have well-developed supply chains and infrastructure to support the production of batteries on a large scale. Some of the key battery tech manufacturing countries include China, Japan, South Korea, the United States, Germany, and India. These countries have big EV firms like Tesla, Inc. (NASDAQ:TSLA), Ford Motor Company (NYSE:F), and XPeng Inc. (NYSE:XPEV). 

We talked about the 10 most advanced battery technologies in a separate article in detail. Battery tech manufacturers are situated around the world, and they produce a wide range of battery types, including lithium-ion batteries, lead-acid batteries, and nickel-metal hydride batteries, among others. Many small countries are also involved in the production and development of batteries. As technology is emerging, many countries across the globe are beginning to enter the battery manufacturing industry. 

Chinese firms dominate the electric vehicle (EV) battery market, accounting for 56% of the market share. Four of the ten largest battery manufacturers are based in China. South Korean companies and Japanese firms also have a significant presence in the market. Several major battery companies are based in the United States, including QuantumScape, A123 Systems, Enovix, SES AI, and Amprius Tech. 

Considering lithium reserves, Chile has the largest known reserves of lithium in the world, with a total of 8 million tons. This puts it ahead of other countries with significant reserves, such as Australia (2.7 million tons), Argentina (2 million tons), and China (1 million tons). In Europe, Portugal also has smaller deposits of lithium. 

The global battery technology market size is expected to grow from $95.7 billion in to $136.6 billion by at a compound annual growth rate of 7.4%. The adoption of electric and hybrid vehicles and the increasing usage of wearable devices are responsible for the growth of the battery technology market size. Some other sectors, such as solar and wind energy systems, are also emerging and the world is making its way towards environment-friendly energy.

The global adoption of electric vehicles (EVs), falling battery prices and increased investment by top automobile OEMs are what are fueling the growth of the total EV battery industry. Additional factors include increased investments in expanding lithium-ion battery capacity, the expansion of battery-as-a-service systems, and rising acceptance of electric mobility in emerging nations, all of which present major market prospects.

The factors that limit the global EV market include the less energy-dense batteries and probable shortage of lithium mining capacity, and possible safety concerns with EV batteries are posing a threat to the market's expansion for EV batteries. Considering the EV battery production by country, with a 56% market share, Chinese companies lead the industry. China is home to many in the top 10 battery producers list. Japanese and South Korean businesses are likewise well-represented in the sector. Furthermore, Chinese battery is also leading in the battery supply chain, mining metals and refining battery components, etc.

Korean companies contributed a 26% share in global EV battery production last year. Samsung SDI, SK On and LG Energy Solutions are a few notable contributors to the market. The aforementioned companies provide EV batteries to automotive giants such as Tesla, Ford Motors and General Motors. Japanese companies are another key player in EV battery production with 10% of the total EV production worldwide. Companies such as Panasonic ranks 4th among the world&#;s largest battery-producing companies.

Around 948 GWh of lithium-ion (Li-ion) battery capacity is currently deployed globally. Out of this, the global EV battery production capacity is almost 274 GWh. If the recent trends in the adoption of EVs and E-mobility are considered, several thousand GWh of batteries will also be needed to accommodate the tens of millions of EVs that will be added each year.

Between and , the demand for Li-ion batteries from light vehicles will expand at a compound annual growth rate (CAGR) of about 40%, reaching roughly 2,050 GWh as predicted by S&P Global Mobility. In the same time frame, installed battery capacity will increase by 23.5% CAGR to 3,371 GWh in .

The Asia-Pacific region again takes the lead when the largest lithium battery producers are concerned. Several major companies in the list of largest lithium battery producers are from China. Notable names include CATL and BYD with a total production capacity of 137.7 GWh and 51.5 GWh respectively in the year . The US was able to produce 44 GWh of lithium-ion batteries in , and by , that capacity is expected to increase to 91 GWh. The development of technology in the US has had a significant impact on battery production as well. The US provided the majority of cutting-edge battery technology.

Our Methodology

These were picked from a careful assessment of the battery industry. The details of each battery tech country are mentioned alongside a discussion around top firms in the sector in order to provide readers with some context for their investment decisions. The countries have been ranked according to their share of global lithium-ion battery manufacturing capacity in . 

Lithium Battery Production By Country: Top 12 Countries

Lithium Battery Production by Country: Top Countries

10. Australia

Share of global lithium-ion battery manufacturing capacity in : 0.1%

In , Western Australian mines produced about half the world's lithium, at an estimated 55,000 metric tons. Recent years have seen an increased number of lithium battery manufacturing facilities begin their production in Australia. This lithium is used for electric vehicles and other product batteries. Australia&#;s lithium production is set to increase by 24.5% to 68.45 thousand tonnes in . Lithium output is expected to increase at a compound annual growth rate of 14.2% to 116.24 kt in . 

Pilbara Minerals is the biggest lithium mining company in Australia. Pilbara produces over 377,000 metric tons of lithium every year. Greenbushes is Australia's largest lithium mine, of the 55,000 tonnes of lithium mining in the country in . In Australia has supplied roughly half of the world&#;s lithium.

Australia also has dozens of new battery startups. Evergreen, Greensync, Carnegie Clean Energy, RayGen, Bell Resources and Graphene Manufacturing Group Ltd are a few famous ones. Energy Renaissance produces climate-optimized lithium-ion batteries for domestic and commercial users in Australia. The biggest battery in the world is in Australia named The Victorian Big Battery. This battery can store enough energy to power more than one million Victorian homes for 30 minutes.  The battery has a capacity of 100 MW/129 MWh and can provide critical grid support services, such as frequency control and ancillary services, to help stabilize the grid during times of high demand.

Just like Tesla, Inc. (NASDAQ:TSLA) and Ford Motor Company (NYSE:F) in the US and XPeng Inc. (NYSE:XPEV) in China, Australia is also home to some of the largest battery firms in the world. 

9. United Kingdom

Share of global lithium-ion battery manufacturing capacity in : 0.3%

UK has several EV battery companies such as British Volt, Aceleron, Williams Advanced Engineering, Zenobe, Moixa and Oxis Energy etc. As the world is gradually shifting from fossil fuels to renewable energy resources, the UK government plans to ban the sale of diesel and petroleum cars by . Hence, there is a growing demand for batteries in automobiles, aerospace, electrical utilities and other related sectors. 

The government of the UK has promised nearly £500 million in the next four years for mass-scale production of batteries. British Volt has plans for a £2.6bn Gigafactory in Northumberland on the site of the former Blyth Power Station. The Company will produce 300,000 lithium-ion battery packs each year. These will be supplied to the automobile electric industry. 

8. Sweden

Share of global lithium-ion battery manufacturing capacity in : 0.6%

Sweden is home to several EV battery companies. Sweden's auto market recorded an electric vehicle share of 46.1% in August as fully electric cars grew their shares. In August, Volvo Group began the process to establish a large-scale battery cell factory in Sweden. The company plans to gradually increase capacity and reach large-scale series production by . The battery cells will be manufactured specifically for commercial vehicle applications, busses, trucks and electric drivelines for other different applications. Volvo said that by , at least 35% of their products will be electric. 

Northvolt AB is a Swedish battery maker and plans to deliver batteries with an 80% lower carbon footprint. Northvolt has a target of 150GWh for annual cell output by . Northvolt Ett will produce 16GWh of battery capacity per year. The company will scale up its production at a later stage to potentially 40GWh. 

7. Germany

Share of global lithium-ion battery manufacturing capacity in : 1.6%

When it comes to technology and innovation in the electric vehicle sector, Germany is one of the leading countries in it. The country is home to some of the best electric vehicle makers including Volkswagen and Tesla. Millions of tons of lithium are mined in places far away from Germany to produce lithium-ion batteries every year. These batteries are used in electric vehicles, grid energy storage and wearable technology. 

Scientists at KTI have invented a minimally invasive technology to mine lithium in geothermal plants in Germany. Using this technology thousands of tons of lithium could be extracted from the German and French Upper Rhine trench every year.

The government of Germany has approved a plan to spend $6.1 billion over three years to increase the number of charging points for electric vehicles across the country. The country will increase its charging stations by 14 times. Germany has 70,000 charging stations now and plans to reach 1 million by . The country also plans to have fifteen million electric vehicles on the road by . Currently, there are 1.5 million electric vehicles in Germany. 

6. Japan

Share of global lithium-ion battery manufacturing capacity in : 2.4%

Japan has highly profited from the increasing demand for EV batteries and consumer electronics. Japan is producing batteries worth nearly 930 billion Japanese yen (JPY) yearly. The battery producer covers the entire battery industry by producing batteries from watch button cells to lead acid car batteries. Japan has produced more than JPY 436 billion worth of batteries for electric vehicles. Nickel metal hydride batteries are worth 209 billion JPY. Lead acid batteries made by Japan are worth JPY 154 billion. 

Some of the world&#;s biggest battery companies are located in Japan including Panasonic, Murata, Kyocera, Toshiba, ELIIY Power, FDK, Mitsubishi and EV Energy. Panasonic has a market share of 10%. In , it was the only company to supply batteries to Tesla. It is working with Tesla to start production of its new battery, which is more than double in diameter compared to standard batteries. Panasonic has shipped more than 200 billion batteries across the globe since . The company will triple its battery production by . 

In addition to Tesla, Inc. (NASDAQ:TSLA) and Ford Motor Company (NYSE:F) in the US and XPeng Inc. (NYSE:XPEV) in China, Japan is also home to some of the largest battery firms in the world. 

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Disclosure. None. Lithium Battery Production By Country: Top 12 Countries is originally published on Insider Monkey.

Mines extract raw materials; for batteries, these raw materials typically contain lithium, cobalt, manganese, nickel, and graphite.

The &#;upstream&#; portion of the EV battery supply chain, which refers to the extraction of the minerals needed to build batteries, has garnered considerable attention, and for good reason.

Many worry that we won&#;t extract these minerals quickly enough to meet rising demand, which could lead to rising prices for consumers and slow EV adoption. There&#;s also concern that the US is missing out on economic opportunities, new jobs, and a chance to strengthen the supply chain.

More importantly, mining is routinely associated with human rights abuses and environmental degradation. Certain mines have used or are using child and/or forced labor to extract the minerals used in EV batteries; there are also many documented cases showing the devastating effects of mining on local communities and environments.

Across the world, there is particular concern about the negative impacts of new extractive developments on Indigenous communities. In the United States, the majority of nickel, copper, lithium, and cobalt reserves lie within 35 miles of Indian Country.

Below we explain the steps involved in the upstream portion of the EV battery supply chain, answer five questions about the challenges facing the mining industry, and describe what&#;s being done to address the industry&#;s negative impacts.

What is the &#;upstream&#; portion of the EV battery supply chain?

In the upstream portion of the supply chain, mines extract raw materials; for batteries, these raw materials typically contain lithium, cobalt, manganese, nickel, and graphite.

Because of the energy required to extract and refine these battery minerals, EV production generally emits more greenhouse gases per car than cars powered by fossil fuels. However, the average EV makes up for this difference in less than two years. Over a typical vehicle&#;s lifetime, EVs produce significantly less emissions than traditional vehicles, making them an essential tool to combat climate change.

Lithium-ion batteries, the kind that power almost all EVs, use five &#;critical minerals&#;: lithium, nickel, cobalt, manganese, and graphite.

The Energy Act of defines critical minerals as a &#;non-fuel mineral or mineral material essential to the economic or national security of the U.S. and which has a supply chain vulnerable to disruption.&#; There are around 35 minerals categorized as critical.

Critical minerals are found across the world, but most economically viable deposits are found in only a few places. For instance, much of the world&#;s cobalt is located in the Democratic Republic of the Congo while lithium is concentrated in South America and Australia. As a result of this geographic diversity, the supply chain for electric vehicles is truly global.

Do we have enough minerals to make the EV batteries we will need?

Yes. While demand for these minerals is already high and expected to grow significantly in the coming years, there are enough minerals to meet today and tomorrow&#;s EV needs.

The problem is that the upstream portion of the supply chain is unprepared to meet this demand. Today, although there are enough minerals, there are not enough operating mines.

Since it can take years to establish a mine, we need to move very quickly to ensure that supply can meet growing demand while also respecting the expressed needs of local communities. This work will require significant investment to do so: in the United States alone, we&#;ll need to invest $175 billion in the next two or three years to match China&#;s battery production.

How do mining practices contribute to human and environmental injustice?

Today&#;s mining practices can involve:

Child and/or forced labor: According to the International Labor Organization, more than 1 million children are engaged in child labor in mines and quarries; many receive little to no pay. These practices are a form of modern slavery.

Tailings storage are another form of mine waste that harms local environments and residents. Once a mineral has been extracted from the ore, the rest of the ore is disposed of. These leftovers are called tailings and are usually dumped in above-ground ponds held together by humanmade dams. When these dams collapse, they can cause deadly mudslides that destroy farmlands and nearby towns. Collapses can also pollute bodies of water that local communities rely on for food, agriculture, and income. Since , more than 250 tailings dam failures have been recorded around the world, killing 2,650 people. In , a single dam failure at a mine in Brazil claimed the lives of 270 people in a tragic instant.

Water pollution and depletion: Drilling and excavation can contaminate surface water and groundwater reserves. As Earthworks notes, many mines in the US have historically failed to control their wastewater, which has led to polluted drinking water, harm to local habitats and agriculture, and negative public health impacts. Globally, mines dump more than 200 million tons of mining waste directly into lakes, rivers, and oceans every year. Mining also requires huge amounts of water; more than 2 million liters of water are needed to produce one ton of lithium. Because mining often occurs in arid and semi-arid regions, this can seriously stress local water supplies for communities and ecosystems.

Gender discrimination across the mining industry: Despite women&#;s significant contributions to mining, their work has been less valued and less protected than that of men, according to the International Labour Organization, which also notes that in large-scale mining operations, women rarely make up more than 10 percent of mineworkers. In many countries women are expressly prohibited by law from holding certain positions at mines.

What are the factors that contribute to human and environmental injustice?

There are many factors that contribute to human rights abuses and environmental degradation, including:

Some mineral reserves are in conflict-affected and high-risk areas: Many of today&#;s operating mines are in regions labeled as a conflict-affected and high-risk area (CAHRA), which the Organisation for Economic Cooperation and Development defines as places &#;identified by the presence of armed conflict, widespread violence, or other risks of harm to people.&#; The presence of civil and international wars, insurgencies, political instability and repression, and corruption are some examples of factors that determine whether an area is considered conflict-affected or high risk. At the time of this writing, the European Union has identified 28 countries with CAHRAs.

Economic dependence on artisanal and small-scale mining (ASM): Unlike large-scale mining, ASMs are operated by individuals, families, and/or groups and are often informal and completely unregulated, which leads to little to no health, safety, or environmental protections. They do not always use modern equipment; some rely on tools like shovels and pickaxes. As the European Union notes, in some cases, ASMs are controlled by armed groups, who use the extracted resources to finance conflicts.

Outdated mining laws: Current US laws governing mining do not address the complex challenges facing the sector. For instance, the General Mining Law of remains the most prominent mining regulation today in the United States. Governing the extraction of critical minerals on federal lands, it has not been meaningfully updated since President Ulysses S. Grant signed it more than 150 years ago to promote westward expansion. It does not require mining companies to pay federal royalties to taxpayers and includes no environmental protection provisions. Laws such as these do not reflect the complexities of today&#;s mining practices; it&#;s especially important that they require free, prior, and informed consent of Tribal nations, who often bear the brunt of mining&#;s negative impacts.

A lack of tools to monitor mining practices: Without good governance or transparency from organizations, there&#;s no way to definitively know how most mines treat their workers or affect the surrounding environment. Journalists have been largely responsible for uncovering human rights abuses and environmental degradation. We often rely on assurances from mining companies, which often prove to be inaccurate or incomplete. That&#;s why we need third-party tools to monitor mining practices: we must have data from trusted sources to meaningfully address destructive operations and hold bad actors accountable while continuously requiring responsible practices.

What is being done to address human rights abuses and environmental impacts?

Activists, advocates, policymakers, employers, governments, and others are working to integrate environmental justice in the EV battery supply chain by:

Onshoring/reshoring/friend shoring efforts: Though far from a complete solution, investing in EV supply chain capacity within the United States and its allies will help diversify supply and limit exposure to human rights abuses and detrimental environmental impacts. When upstream supply is concentrated in a few countries, downstream purchasers have little leverage over their suppliers&#; human rights and environmental practices. In general, the United States and its allies have strong oversight over human rights concerns and high-quality environmental protections, although there is always room for improvement. The goal here is not self-reliance, however, but rather greater diversity and competition, helping put pressure on all countries to adhere to improved standards.

Leading efforts to update legislation: At the time of this writing, the Biden administration is convening an Interagency Working Group on Mining Regulations, Laws, and Permitting, which will provide recommendations to Congress on how to reform mining law to include provisions that protect the environment, involve local communities, and reduce the time, cost, and risk of mine permitting. Likewise, the Initiative for Responsible Mining Assurance (IRMA), has provided recommendations to the Department of State&#;s Clean Energy Resources Advisory Committee regarding what should be included in these updates. The US Department of State&#;s Minerals Security Partnership has also recently announced principles marking a public commitment to full integration of environmental, social, and governance standards into its work.

Improving EV supply chain transparency: &#;Battery passports&#; can help manufacturers certify where battery minerals are sourced and verify that these sources are following globally recognized ethical practices.

Convening stakeholders to drive action. IRMA brings together industry, affected communities, governments, and others to provide an independent third-party verification and certification against a comprehensive standard for all mined materials that provides &#;one-stop coverage&#; of the full range of issues related to the impacts of industrial-scale mines.

Automakers are also making commitments to ensure that materials are ethically sourced. For instance, Ford requests that suppliers source raw mined materials from entities committed to and/or certified by IRMA.

Although the upstream portion of the EV battery supply chain faces many challenges, we can address them with investment, improved laws and regulations, and public awareness. These steps will help ensure that we have the batteries we need for an electrified transportation future without harming people or the planet.

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