How EV Battery Production in the USA Could Boost ‘Made in America’ Agenda

Understanding the Inflation Reduction Act’s Impact on EV Batteries

In this article, Pinnacle Converting Equipment discusses the implications of President Biden’s Inflation Reduction Act on EV battery production in America. Specifically, we cover:

• What’s inside an EV battery
• What American manufacturers can do to compete
• Where to get battery converting equipment

Recently, President Biden signed the Inflation Reduction Act, which requires at least 50% of an electric vehicle’s battery to be made in America to qualify for a federal discount. Unfortunately, the United States’ current battery production landscape looks dismal compared to countries like China and even Australia. Sourcing the materials required for battery production in the U.S. could prove difficult (if not entirely impossible).

Rather than focusing on sourcing materials within America, manufacturers should direct their efforts towards building up their EV battery production and assembly capabilities. By properly equipping their facilities, manufacturers can remain competitive in the space while satisfying the Inflation Reduction Act’s EV battery requirements.

What’s Inside an EV Battery?

EV batteries are comprised of thousands of individual batteries, each of which are carefully assembled inside the heart of the vehicle to act as its fuel source. Every battery is made up of two key parts: the anode and the cathode. Anodes are copper foils that are precision cut to wrap around the separator and the cathode. Cathodes are typically made of aluminum and lithium; however, there are many other minerals that go into the production of cathodes, including cobalt, manganese, and nickel.

Where Do EV Battery Materials Come From?

Because so many unique minerals and metals go into battery production, sourcing these materials results in a complex global supply chain. Here’s who’s responsible for supplying most of the world’s materials for EV battery production:

• Australia: 55% global lithium mine production
• China: 80% global cathode component production; 89% global anode component production
• Congo: 71% global cobalt mine production
• Indonesia: 37% global nickel mine production
• South Africa: 37% global manganese mine production

While China does not mine the individual minerals required for battery manufacturing, they dominate the marketplace by supplying the world with the completed anodes and cathodes needed to produce a battery. Not only that, but China boasts the largest battery manufacturing capacity in the world at 76% of the entire market share. By contrast, America only accounts for 7% of global battery manufacturing capacity.

What Can American Manufacturers Do to Compete?

Despite what the global stage may say, America does have its fair share of mineral deposits that can be mined. However, getting the approval and permits required for mining and processing these mineral deposits can be incredibly difficult. According to analysts from the Wall Street Journal, getting this supply chain off the ground in the United States likely wouldn’t happen before the end of this decade.

It’s also highly unlikely that American manufacturers would be able to ramp up their anode and cathode production in the near future. With China as the dominant force behind anode and cathode production worldwide for so many years, the U.S. will have a hard time taking that title away from them at this point. As production costs continue to rise, competing in that capacity will only become increasingly difficult.

Where American manufacturers can potentially make an impact is by boosting their battery assembly capacity. Manufacturers like Panasonic and LG have already made strides in this area by working in partnership with automotive manufacturers to build larger facilities and production lines in the U.S.

EV Battery Converting Equipment

As United States manufacturers expand their assembly capacity, they will need to ensure their facilities are properly equipped with the right tools. EV battery converting equipment will become essential for satisfying growing battery demand in America. These machines will help streamline battery production for manufacturing professionals, allowing them to remain competitive against the likes of China, Australia, and other countries currently dominating the space.

By assembling these batteries in America, manufacturers could potentially find a way to satisfy the “50% made in America” rule from the Inflation Reduction Act. This would allow more companies to take advantage of the federal discount, lowering their costs.

Where to Get Battery Converting Equipment?

Pinnacle Converting Equipment is proud to offer manufacturing professionals the state-of-the-art equipment they need to satisfy growing demand for EV batteries in America. Each of our powerful machines is made in the USA and is custom-tailored to the unique needs of your production line. Find the converting equipment you need to strengthen your EV battery assembly facility: Contact Pinnacle Converting Equipment for a custom quote today!