At the very beginning of this decade, electric vehicle (EV) sales increased by 50% to 6,6 million vehicles. As the automotive industry is witnessing a surge in demand, it is expected that EVs could exceed 50% of total automotive sales in markets by 2030. Concerns about global warming and people’s health have increasingly motivated the industry for battery-powered cars, trucks, and buses to generate zero tailpipe emissions.
Mining of scarce metals that are used in electric car batteries like cobalt, copper, lithium, and nickel carries a harsh environmental and social cost. This refining process has a societal impact that is far from being resolved and is classified by the Basel Convention as hazardous and further can challenge sustainability.
To revamp the mobility sector, batteries need to be treated and recycled effectively. It has been calculated that impact recycled batteries will cut about 40% of the carbon content. However, there are a few challenges that the EV industry is facing.
Enhancing the EV battery value chain
Analyzing the state of a battery pack is not an easy task. After quality and depletion are assessed, we can determine the life of the battery as batteries with some power left can be given a second life by converting them into power packs for mobile vehicle charging, and in another case, when the batteries have little left, they can be ground down to a fine powder to extract raw materials such as lithium, nickel, and manganese and restart the battery’s life cycle.
Designing a business strategy for EV battery value-chain investment
The expenses involved in gathering used batteries and managing the required logistics have an impact on the overall business case and prevent the development of economies of scale. According to members of the Circular Cars Initiative group, the most important problem now facing battery-powered mobility is the cost of individual battery collecting. Costs associated with recycling batteries can be as high as 41% only for transporting End of Life (EoL) batteries.
The market for EV batteries is increasing. By 2030, it is anticipated that the market for battery cells alone would increase by more than 20% yearly and reach $360-410 billion. Due to businesses’ perceptions that this is a competitive market, this greenfield is occasionally not explored collectively. In order to improve the business case for value-chain battery management, twelve companies involved with the Circular Cars Initiative along the car battery value chain—including Analog Devices, CATL, DHL, Hoppecke, Jaguar Land Rover, Li-Cycle, Mahindra, Mercedes-Benz, Volvo Group, and Umicore—were inspired to create a roadmap:
The lack of a uniform set of standards for tracking battery health, gathering hardware, and managing reverse logistics—recovering the value of a product at the end of its life cycle—is another big obstacle for EV batteries. Without uniform standards, each business is compelled to create unique specifications depending on the point at which batteries stop operating. Suppliers consequently struggle to synchronize operations and services.
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