Daimler official: Europe must counter Asian battery cell dominance

By Nico Esch, dpa

The battery is the heart of every electric car – and the cell is the heart of the battery. Everyone needs them, but in Germany, it seems no one wants to make them. A top Daimler official warns this could come back to haunt the industry.

Stuttgart (dpa) – A top official from German car giant Daimler is sounding the alarm about the market dominance of Asian manufacturers of electric car battery cells.

Michael Brecht, head of the company’s works council, wants to see suppliers in his home country – or elsewhere in Europe – step up to the plate, coming up with their own initiatives for the field.

“We need a German or European solution,” Brecht told dpa in an interview. And, he says, time is running out.

“Someone must now come out and say ‘I am confident I can do it.'” In his opinion with each passing year, it becomes more difficult to do so.

German carmakers have already poured a lot of money into battery assembly plants where the blocks can be assembled according to how they will end up being used. Daimler even has two further assembly plants in the offing, both to be built near Stuttgart.

But the cells – the core component of each battery – are currently purchased in Asia, where just a few producers tower over the market.

“The cell is the core element of the entire process of electrification,” Brecht says. The performance of an electric car rests on the cell.

“You are making yourself dependent not only on the technology, but also liable to blackmail should a supplier become so powerful in the market that they can dictate prices and other such things,” he warns.

As a result, having one’s own cell production under German or European leadership is a matter of self-protection, Brecht believes.

As head of Daimler’s works’ council, he represents the interests of 290,000 Daimler employees worldwide and holds a seat on the company’s supervisory board.

Yet various major companies, including Bosch and ZF, have ruled out starting cell production any time soon.

Continental is pondering the idea, looking into solid dosage technology, which is regarded as the next generation of cell technology. A decision will only take place after 2020, however.

While German firms weigh up the pros and cons and prevaricate, the Chinese manufacturer CATL is building up production in the eastern German state of Thuringia.

Yet Brecht says he himself does not want Daimler to enter the field: the carmaker made a stab at battery cell production in the past but then abandoned the endeavour.

He says it is now up to component makers, working with firm commitments from carmakers to buy a certain amount of the cells.

“The cell suppliers of today are learning all the time. And if they set up cell production operations now, this first generation cannot yet be economical viable. For this reason, it must also take place with political support,” Brecht says.

And such support is there, according to Brecht: “There are quite clear signals, from as high as up the chancellor, which say, ‘We want to have something like this in Germany and we want to support you.'”

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