With the rapid expansion of electric vehicles (EVs), focus of global competition in the automotive industry is shifting from cars themselves to battery technologies.
As production costs, supply chains and geopolitical dynamics are increasingly reorganized around energy storage technologies, batteries are emerging as the strategic core of the automotive industry.
Batteries account for about 40% of EV costs, keeping lithium-ion technology dominant while supply concerns over critical minerals drive interest in alternatives such as low-cost sodium-ion batteries, as solid-state options remain pre-commercial, according to the International Energy Agency's (IEA) special report "What Next for the Global Car Industry? An Energy Technology Perspectives."
- Competition intensifies around battery packs
Speaking to Anadolu, Christian Phillip, president of the Austria-based Trusted Charging Alliance, said competition in electric vehicles is shifting toward batteries because "the battery pack is the most expensive and supply‑constrained component, so its cost and availability largely determine pricing, margins, and model strategy."
Phillip said battery cost and availability shape pricing, profitability and model strategies, noting that rising battery-pack complexity is pushing automakers to tailor vehicles by chemistry and invest in cell factories, long-term raw material contracts and regional integration to manage costs and meet local production rules.
Pointing to supply concentration in critical minerals, Phillip said interest in alternative technologies is rising, noting that despite lower energy density, sodium-ion batteries reduce dependence on lithium and cobalt, making them more resilient to price shocks and geopolitical risks.
Phillip said, "Solid-state battery roadmaps remain largely lithium-intensive, meaning companies see them less as a solution to critical mineral constraints and more as a performance and safety option, with mineral supply concerns shaping the timing and scale of deployment rather than the underlying technology choice."
No single battery technology can currently meet all the needs of mass mobility, he noted.
- China's dominance poses strategic risk
Phillip said China's dominant position in the battery supply chain represents a clear strategic risk, though one that is largely unavoidable for the global automotive industry in the short to medium term.
"China controls around two‑thirds of EV battery manufacturing capacity and a similar or higher share of processing for key minerals like lithium, cobalt and graphite," he added, noting that this gives China significant leverage over prices, technology access and export policies.
He said automakers and governments are seeking to reduce this dependence through regional gigafactories, supplier diversification and stricter industrial policies, but added that China's capacity cannot be replaced quickly.
Phillip said the EU's plans to tighten environmental and governance standards could force Chinese producers into major investments or risk losing market share in Europe, but delays in implementation have left Europe's automotive sector facing an uneven competitive environment.
- Battery strategies to shape next decade
Phillip said that over the next 5 to 10 years, competitive advantage in electric vehicles will stem more from production scale and system integration capabilities.
"Over the next five to ten years, competitive advantage will likely come less from a single breakthrough chemistry and more from mastery of three areas: high‑volume lithium‑ion, next‑generation variants like solid‑state for premium niches, and system‑level integration," he said.
Stressing the importance of scaling up affordable lithium iron phosphate (LFP) technology, Phillip said manufacturers that combine low-cost LFP production with targeted use of solid-state batteries and localized, recycling-backed supply chains will gain lasting competitive advantages.
Mass adoption of electric vehicles ultimately depends on a tangible reduction in total mobility costs, he added.
By Humeyra Ayaz
Anadolu Agency
energy@aa.com.tr
