Japanese EV battery industry group aims to take on China

The Yomiuri Shimbun

13:11 JST, March 9, 2021

A group of Japanese companies will form an industry association in April to strive for stable production and supply of batteries to be equipped on electric vehicles and other electrified automobiles.

The Battery Association for Supply Chain (BASC), a general incorporated foundation of about 30 Japanese companies, will work together with the Economy, Trade and Industry Ministry to come up with rules and strategies.

The aim is to enhance Japanese industry’s international competitiveness in the battery sector as China continues to increase its presence in the market.

Batteries are key components for electric vehicles, accounting for about 30% of total production costs.

In this regard, the association will discuss the realization of a cooperative framework for effective procurement of raw materials such as nickel and lithium, as well as for effective production and supply of batteries.

In cooperation with the ministry, the group will also try to formulate rules for the smelting and recycling of lithium and other rare metals.

Global market share for electrified vehicle batteries is led by China. Japanese companies used to be in the lead, but as of 2019 China has 40% of the market, while Japan is second at 28%.

China also has large reserves of rare metals and aims to make its lithium processing technology the international standard.

With the global trend toward decarbonization, major automakers have announced plans to introduce electrified vehicles, so demand for electrified vehicle batteries is expected to rapidly grow.

Japanese companies participating in the BASC include leading battery manufacturer GS Yuasa Corp.; Prime Planet Energy & Solutions, Inc., a joint venture formed by Toyota Motor Corp. and Panasonic Corp.; and raw material supplier Sumitomo Metal Mining Co.

The BASC companies will seek to cooperate with each other for the stable procurement of rare metals and other raw materials and for the expanded production of batteries.