Analysts Warn of Dependence on Foreign Batteries
June 22, 2008
As focus in the auto industry shifts from conventional petrol and diesel powered models to a new generation of hydrogen fuel-cell, all-electric and hybrid vehicles, demand for components to support the new technology is skyrocketing and those companies that have been in the business for years are now reaping the benefits. The sector with the brightest future is the battery industry, with demand for high-capacity lithium-ion batteries expected to grow the most.
Despite American research and engineering firms making significant advances in the field recently, Asian companies that have been building rechargeable batteries for the good part of the last two decades are expected to benefit the most. Most major carmakers are forming strategic alliances with Asian electronic companies as the race to develop low-cost volume electric vehicles continues.
We’ve seen Toyota join with Matsushita and Volkswagen team up with Sanyo, and many more similar alliances are expected to be revealed in the next couple of years. GM is one of the few companies to form a partnership with an American technology company, but according to the Detroit Free Press the batteries for its upcoming Chevrolet Volt plug-in hybrid (pictured) will be made in either South Korea or China.
Considering that batteries alone could cost up to $10,000 per car for vehicles like the Chevrolet Volt, there are fears that countries will simply be substituting their dependence on foreign oil with dependence on batteries as electric vehicles start to become mainstream. Analysts are already predicting battery sales approaching $10 billion annually worldwide by 2015.
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