Japan Aims To Ramp EV Battery Production Amidst Stiff Competition

Japan is aiming to massively boost the rechargeable battery output capacity of Japanese companies as it seeks a 20 percent global market share for the valuable sector by 2030, the country’s ministry for industry has said.

“We will step up our support to help the Japanese battery industry recover global market share, which it has lost over the past several years in the battle with Chinese and South Korean rivals,” said Nobutaka Takeo, a director at Japan’s METI industry ministry, at a press event.

The ministry is aiming for a tenfold increase in domestic global battery output capacity to 600 gigawatt hours by 2030 as it loses market share to competitors from China and South Korea.

It said Japan’s global market share for the lithium-ion batteries used in electric vehicles (EVs) dropped to 21 percent in 2020 from 40 percent in 2015, with its share of batteries for energy storage systems falling to 5 percent in 2020 from 27 percent in 2016.

Critical tech

The ministry didn’t give a figure for Japan’s current overall market share in rechargeable batteries.

Japan’s current capacity for EV and storage system batteries currently stands at about 20 GWh, and the ministry said it wants to expand that to 150 GWh by 2030.

It wants the overall output capacity for domestic battery makers to rise from the current 60 to 70 GWh to 600 GWh by 2030, and is targeting the full-scale commercialisation of all solid-state batteries by around 2030.

Such batteries are the most important technology in the electrification of automobiles and other mobility devices and for helping to boost the use of renewable energy, METI said.

It said it plans to present a final battery strategy this summer, including concrete support measures.

Japanese automaker Honda earlier this month announced a belated investment strategy in electric vehicles, but it continues to rely on lithium-ion batteries from third-parties such as General Motors or Chinese battery giant CATL for its EVs.

Battery war

Honda is also developing its own line of solid-state batteries, which it hopes to bring to market in the second half of this decade.

Solid-state batteries are intended to be lighter and faster to recharge than current lithium-ion models.

Japanese battery company Envision AESC earlier this month announced it plans to build a $2 billion (£1.5bn) next-generation battery plant in Bowling Green, Kentucky, supplying multiple automakers.

The announcement followed the announcement last year of an even bigger $11.4bn plant in the state by Ford and its battery partner, South Korea’s SK Innovation, last year.

In the US alone 38 fully electric vehicle models are currently on sale, a figure expected to grow to more than 120 by 2025.

Car companies sold nearly 4.6 million EVs worldwide last year, with consulting firm LMC Automotive projecting that to rise to 7 million this year and more than 15 million by 2025.

That number would still, however, only make up about 15 percent of global auto sales.

The European Union is also seeking to boost domestic battery production to reduce its reliance on Asian producers, with a major battery plant from start-up Northvolt beginning production late last year.