The crumbling of Europe’s once-ambitious battery industry has prompted a strong warning from two of the continent’s most senior industrial leaders: forget going for it alone, partner with China, or risk falling further behind.
The fall of battery maker Northvolt has left a vacuum in Europe, as it seeks to align itself with major Chinese players and secure a closed-loop business model to support its ambitions in electric mobility. That dream is completely shattered, according to two captains of industry who together propagate for partnerships with Chinese firms instead of growing an independent battery pipeline.
Lose your illusion
Bart Sap, the chief executive of Belgian battery materials giant Umicore, and Christel Bories, the departing chair of French mining group Eramet, have called on European policymakers to drop the illusion that the EU can build a self-sufficient battery ecosystem in the face of China’s dominance.
Speaking to the Financial Times, Sap argued that the moment has arrived to “embrace China to help produce with us in Europe.” He further warned that failure to do so would leave the continent dangerously dependent on foreign powers for its electric vehicle future. Bories echoed the sentiment, urging Brussels to “be realistic” about China’s head start and technological advantage. She believes they are simply two decades ahead.
Headwinds
The remarks come as Europe is trying to digest the collapse of aforementioned Northvolt, the Swedish battery start-up once touted as the continent’s best hope of industrial autonomy. Its failure has cast a long shadow over EU efforts to gain control of a supply chain that is increasingly defined by Chinese firms such as CATL and BYD. Together, these absorb more than half the global battery market.
Billions in EU subsidies and strategic declarations have failed to produce a competitive battery sector. A volatile EV market, shifting consumer demand, and China’s rise in low-cost lithium-iron phosphate (LFP) batteries have only deepened the crisis.
In the face of these headwinds, Sap and Bories advocate a pragmatic, some might say defeatist, path forward: deeper cooperation with Chinese manufacturers. They suggest that Europe should ensure that incoming Chinese investment includes binding requirements for local partnerships, knowledge transfer, and the creation of European jobs.
Europe: an assembly base?
But not everyone is convinced that this is the only option left. Julia Poliscanova, senior director at Transport & Environment, warned that many Chinese firms treat Europe as little more than an assembly base. She points out that their strategy is to bring their own workers and share only a small portion of the underlying technology. Without stronger regulation, she said, Europe risks becoming “an assembly plant, not a tech hub”.
But, if anything, Europe is running out of time. Latest available data show that Chinese battery imports into the region surged from €2.7 billion in 2021 to nearly €22 billion in 2023. Meanwhile, European projects, such as ACC in Germany and Italy, are facing delays or cancellations, and the geopolitical backdrop is becoming increasingly hostile.
Is there any hope for an alternative scenario? The EU’s Battery Innovation initiative and the Clean Industrial Deal represent attempts to revive the sector. Furthermore, there are growing calls for increased investment in recycling, raw material processing, and homegrown research and development. However, critics warn that without a more coherent industrial strategy and genuine political will, these efforts are likely to fall short.
