Australia is experiencing a surge in take-up of electric vehicles after years of laggard behaviour, but experts warn the country is not yet equipped to cope with the boom. Australia has fewer than 30% of public charging points per EV in use globally, and there are concerns over delays with plugging stations into the grid, and shaky economics. Despite this, sales of EVs are rising, accounting for 8%of all vehicle sales in April. The Labour government elected in 2019 has also initiated a national EV strategy, and doubled funding for cleaner transport to AUD500m ($339m).
Car manufacturer Stellantis has warned that it will not manufacture electric vehicles in the UK without changes to the Brexit deal. The parent firm of Citroen, Fiat, Peugeot and Vauxhall, which employs over 5,000 workers in the UK, committed to EV manufacturing at its Luton and Ellesmere Port plants two years ago. It has now told a Commons inquiry into EV battery supply that its UK investments are in the balance because of the trade deal agreed by the UK and the EU. Stellantis called for the UK and EU to keep existing rules until 2027 without this being subjected to tariffs.
Stellantis, a major car manufacturer with brands including Vauxhall, Peugeot and Citroen, has warned it may close British factories unless the UK government renegotiates its Brexit agreement with the European Union. The carmaker has committed to making electric vehicles in the UK, but says it is impossible to source enough components locally to meet new rules requiring 45% of component value to originate from the UK or EU. The regulations are required to avoid a ten percent export tariff on EVs. The company warned manufacturing would become “unsustainable” if it could not secure competitive prices, potentially resulting in factory closures.
Experts have suggested that it would be challenging to find businesses that could meet the 45% local component requirements. The production of a battery alone typically represents 40% of an EV’s value. Sir Keir Starmer, leader of the opposition Labour Party, has described the threat as an “existential crisis” for the UK car industry, warning of “800,000 jobs” at risk. The head of the Society of Motor Manufacturers and Traders, Mike Hawes, has called for greater investment in battery production in the UK.
Other companies, including Nissan, have expressed concerns regarding local content regulations. Last year, Nissan and Tesla both warned of the increased costs they may face as a result of rules that will require them to relocate factories or double down on supply chain and procurement strategies to avoid punitive export tariffs.
Greenpeace has said that the UK relies too heavily on lithium battery manufacturing and argued that the move away from the low-carbon market would result in greater global reliance on a small handful of multimillion-dollar mining companies, “where the human and environmental costs are generally high”.
Manufacturers including Michelin and Goodyear are looking for alternatives to the carcinogenic chemical 6PPD, which is found in all tyres and is an antioxidant and antiozonant. Industry players say that finding a replacement will be difficult because the chemical needs to be replaced with something that will prevent tyres from degrading while preserving other attributes, such as safety, noise and abrasion. The EU is expected to establish the first tyre emission regulations, the Euro 7, this year. Tyres emit tiny abraded particles when in contact with a road, which particularly affects electric vehicles, whose extra weight from batteries makes tyre pollution a bigger problem. According to research, particles from tyres are set to be the largest microplastics source that is harmful to aquatic life by 2050.
Citi analyst Shreyas Madabushi has reiterated the company's bullish prediction on lithium prices due to the anticipated improvement of China's EV market and the return of battery restocking in H2 2023. Madabushi claims that lithium prices hit $28,000 per tonne in China over the past two weeks after declining by around 70% over the last five months to $22,000 per tonne. He targets a 25-40% upside, predicting that lithium carbonate prices have reached a bottom, citing improving market sentiment, demand from physical traders, recovering EV sales, lower inventories in the supply chain and more robust export arbitrage. Meanwhile, Bloomberg's energy specialist Javier Blas argues that weak oil prices are due to the thriving black market in oil, with Iran, Russia and Venezuela responsible for almost all the unanticipated and excessive production. Black market crude is available at a discount, with Iranian production having hit a four-year high last month, up 50% from mid-2020.
Buckinghamshire Council has apologised after it mistakenly issued parking tickets to all vehicles parked at two car parks in High Wycombe. The council confirmed that the tickets issued to those who parked at the Railway Place and Duke Street car parks during a closure of the car park would be cancelled. The error occurred after a decision was wrongly taken to close the entire car park when only a portion of the car park should have been closed off. The closure was for the installation of new EV charging bays.
Volkswagen's plans to reach margin parity between electric and combustion engine vehicles may not become a reality until 2025, according to CFO Arno Antlitz. The delay is due to rising raw materials costs, which have made it impossible for the automaker to achieve parity without making its own batteries. Volkswagen hopes to achieve a positive margin on its ID.2 EV model, due to enter production in Spain in 2025. The company may convert its existing Wolfsburg operation rather than build a new factory for future Trinity line EVs, at a lower cost.
South Korean President Yoon Suk Yeol and Canadian Prime Minister Justin Trudeau have signed an MoU to continue joint efforts to fend off North Korea's nuclear and missile threats, alongside efforts to enhance co-operation on critical minerals for the clean energy transition and energy security. The agreement would help both countries be "globally competitive players in areas including batteries and zero-emission vehicles", according to the joint statement. Canada has many of the critical minerals needed to make batteries, such as lithium, cobalt and nickel, and is seeking to help producers and processors to scale up their production.
The US House Natural Resource Committee will discuss a plan this week to protect California’s giant sequoias from fires and climate change. The Save Our Sequoias Act is a bipartisan piece of legislation that offers over $300m and further emergency protection options for US Forest Services to tackle the effects of climate change and wildfires on the world’s largest trees, which are going extinct. However, many Democrats and environmental advocacy groups have opposed the bill, stating that the plan could weaken environmental laws such as the National Environmental Policy Act (NEPA). The legislation would allow environmental projects to move ahead under emergency conditions before being assessed for their potential environmental impact. The outcome of the vote will directly impact the future of protecting the Sequoia National Forest and the balance between environmental protection and climate change mitigation.
Carmaker Stellantis has warned that it could leave the UK altogether if electric vehicle (EV) manufacturing becomes unsustainable. One issue is that under Brexit rules, the UK faces 10% tariffs on cars traded with Europe from 2024. Furthermore, new EU rules insist that from January, EVs must source at least 60% of their batteries from the EU and UK, causing the cost of certain key commodities to increase, suggesting the tightening of the rules represents a problem for car makers on both sides of the Channel. The UK also faces energy challenges with steel makers reporting electricity prices twice what they are in other EU countries.
Stellantis’ warning that Britain’s trade rules with the EU could threaten electric van plant viability at Ellesmere Port has reopened the issue of rules of origin for the car industry. Car factories are concerned that anything that affects their exports to Europe will make them less competitive and more at risk. Rules of origin ensure that goods have sufficient locally-made content to qualify for tariff-free access to markets. Under the EU's post-Brexit Trade and Cooperation Agreement, vehicles sold from one to the other must have 55% of their “content” from within the EU or UK. By January 2024, 60% of an electric vehicle battery pack must originate from Europe or UK to qualify as “local”.
The European Automobile Manufacturers’ Association and leading UK carmakers, including Jaguar Land Rover, Ford, Vauxhall and Peugeot owner Stellantis, have called for a delay to post-Brexit rules that could deal a severe blow to the UK’s car industry. From next year, electric vehicles (EVs) shipped from the EU to the UK, and vice versa, will need to source 45% of their parts within the two regions, or face 10% tariffs under the trade deal. This requirement may force EV makers to incur tariffs, prompting industry leaders to call for a delay in the rules of origin requirements.
The UK is lobbying the European Union to rethink a looming deadline over new rules covering electric vehicles, which the car industry says poses an “existential threat” to the sector, putting thousands of jobs at risk. Vauxhall’s parent company, Stellantis, told MPs it would be unable to keep a commitment to make EVs in the UK without changes to the Trade and Co-operation Agreement with the EU. As of next year, 45% of the value of an electric vehicle should originate in the UK or EU to qualify for tariff-free trade or cars made in the UK would otherwise face a 10% tariff.
Ford has urged the EU to postpone its requirement for post-Brexit trade rules of origin for EV batteries until 2027. The automaker argued that introducing the rules in 2024 would needlessly raise costs for consumers and slow the transition to electric. A pack of batteries currently accounts for up to half the cost of a new EV and are also cumbersome and costly to move over long distances. The UK also lacks sufficient locally sourced batteries and parts to satisfy demand, Ford noted. The automaker is investing £380m ($480m) to create e-motor capacity in a Liverpool engine plant.
Stellantis, parent company of Chrysler, Jeep, and Fiat, has halted construction on its EV battery factory in Windsor, Ontario, citing its demands to match the US's manufacturing incentives under the Inflation Reduction Act. The province and federal government each contributed CAD $500m ($399m) for the facility, demanding that Stellantis and LG Energy Solution match subsidies to keep the project competitive in Canada. The Windsor facility will employ 2,500 workers once it reaches its full capacity. The Inflation Reduction Act was introduced six months after the initial March 2022 deal between the government and Stellantis, in which the federal government is contributing CAD $700m to VW's EV battery factory. However, negotiations became difficult as Stellantis demanded that the government live up to its promise to honour the agreement that was made three weeks prior to construction.
Stellantis has become the first carmaker to urge the UK to renegotiate the terms of its Brexit deal. The parent company of car brands including Alpha Romeo, Peugeot, Vauxhall and Chrysler has called for a delay to beefed-up European Union (EU) “rules of origin”, saying that these could lead to it having to close its Ellesmere Port factory. The factory could be forced into closure as electric vans produced there, which comprise over 70% imported components, face a 10% tariff when they are exported to the EU from next year. Stellantis warned rising costs of raw materials, supply chains and the conflict in Ukraine had prevented it from meeting its planned content standards when announcing the expansion of the Cheshire plant in 2021. Car manufacturers across the UK and continental Europe have echoed its concerns over the rules of origin, which they claim will raise costs for EV drivers and reduce uptake.
China's National Development and Reform Commission (NDRC) and the National Administration of Energy (NEA) have called for an urgent expansion of charging infrastructure for electric vehicles (EVs) in rural areas in order to support the country’s “rural revitalisation” plan and increase the popularity of EVs outside major cities. The NDRC urged local governments to give financial incentives for the construction of EV charging stations and called on EV makers to diversify their products. The take-up of new energy vehicles (NEVs) remains relatively low in rural China, with lots of potential for growth.
During Tesla's annual meeting, Elon Musk announced plans for the first traditional advertising campaign for the electric vehicle manufacturer. Although Musk has previously relied on his celebrity status and social media activity, he suggested that Tesla was willing to 'try out a little advertising and see how it goes'. Musk highlighted that Tesla is not immune to the macroeconomic pressures facing the world today and demonstrated that the role of traditional advertising techniques may still prove useful in today's marketing practices to communicate to a potential and existing a customer base. Despite the popularity of Tesla products, the CEO noted that the company can no longer assume ever-increasing demand while also dealing with rising competition from other companies. Musk acknowledged that the advertising campaign for Tesla would emphasise the safety, affordability and technological features of Tesla's vehicles.
South Korean authorities are taking measures to stem "tech leakage" to rival China, with Seoul creating a database of chip engineers working for South Korean companies to monitor their travel in and out of the country. Seoul has set up several investigatory bodies to combat leaks spontaneously hiring foreign staff, often through patents. Illegal hiring practices, patent infringements and the theft of intellectual property is being tackled with tougher punishments and easier ways to report suspected violations. The same edition of Nikkei Asia details increased South Korean-Chinese competition for technology experts and top-level executives. According to South Korea’s National Intelligence Service, the number of confirmed National Core Technology leaks has risen steadily over the past five years. In terms of technology investment, Taiwan Semiconductor Manufacturing Company recently pledged $100bn to expand over the next three years as part of a strategy to diversify its manufacturing base away from Taiwan.
Tesla has discussed with Indian government officials how it can participate in domestic incentives for vehicle and battery manufacturing. The electric car manufacturer has suggested setting up a factory in the country to produce electric vehicles (EVs) and to locally manufacture EV batteries. Last year, efforts by Tesla and India to strike a deal to lower the import tax on cars were unsuccessful after India officials insisted the company should also build cars locally.
