Autos CEO warns of battery supply scarcity as EV competition heats up
Volvo Cars stated in 2021 that it would become an “fully electric vehicle company” by 2030. This will mean it must have reliable and safe supplies of battery power for all its cars.
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New CEO and President of Volvo CarsCNBC has been informed by CNBC that his firm made investment that will help them gain market share.
Jim Rowan said that Northvolt made an investment of a substantial amount last month so that the business can manage its own supply. He joined the business in October and spoke to CNBC’s “Squawk box Europe” on Thursday.
Volvo Cars announced in March 2021 that they would be a major player in the automotive industry. “fully electric car company” by the year 2030,A move that will require constant and safe supply of its batteries for its vehicles.
Rowan stated, “I believe battery supply will be one of those things that is in short supply over the coming years.”
“That’s why we invested so much with Northvolt. So we can not only control the supply but also start developing our battery chemistry.
He stated that Volvo Cars would be able to “take complete control” of the electric propulsion engine in the future.
Plans for Gigafactory
Volvo Cars and Northvolt, the battery manufacturer, announced in February that they will be partnering. build a battery manufacturing plant in Gothenburg, Sweden,Construction will begin in 2023. Companies claim the facility could produce up to 50 gigawatts of cells annually.
According to them, this could mean that the firm would be able to supply enough batteries each year for approximately 500,000 cars. Although the plans for a gigafactory were previously disclosed, a location has not been confirmed.
As the number of electric vehicles on our roads increases, battery supply will become an increasingly important — and competitive — cog in the automotive sector.
Speaking to CNBC’s Annette WeisbachThis was the same year. VolkswagenHerbert Diess, CEO of the company, highlighted how vital battery production was in the future and noted that there were still challenges.
He said that batteries could be a constant constraint to the growth in EVs for the next five-ten years.
Because the lead times can be very long. There is so little energy available for cell production. [There is a]A huge supply chain must be established within the next few years. This could lead to constraints.
Elon Musk highlighted the importance lithium in this month’s spotlight, which was more recent than usual. Lithium is a crucial component of electric vehicle batteries. The 8. April TeslaThe CEO tweeted that lithium’s price had “gone to insane levels!”
“Tesla might actually have to get into the mining & refining directly at scale, unless costs improve,” Musk said. “There is no shortage of the element itself, as lithium is almost everywhere on Earth, but pace of extraction/refinement is slow.”
Volvo’s plan to electrify puts it in direct competition against long-standing automakers like Volkswagen. GMAnd FordBoth Tesla and Ford. Ford CEO Jim Farley stated this week that his company planned to “challenge Tesla and all comers to become the top EV maker in the world.”
Rowan, Volvo Cars CEO was asked by CNBC if there were any hopes Musk’s Twitter takeover would distract him.
He replied, “I don’t know,” “I do know this:… “I know one thing… I won’t be distracted from the work that needs to be done. We must continue to march toward electrification.
Rowan spoke on the exact same day that his company announced its results for the first quarter 2022.
To reach 74.3 Billion Swedish Krona (7.56 Billion), revenue increased by 8% (or approximately $7.56B). In the second quarter 2021, earnings before interest and taxes were 6.8 billion.
According to the company, the sales of 148,295 vehicles in the first quarter were 20% lower than the previous year.
Supply chain problems continue to impact operations, just like many other businesses. The company stated that semiconductor constraints have improved over time.
However, production of one specific semiconductor was affected by a shortage temporarily at the end the first quarter. The shortage will likely continue into the second quarter.
According to the company, it expects “supply chains will improve in the second-half of the year”.
—Chloe Taylor contributed to this article.