The new year is shaping up to be the year of the electric vehicle, and to keep up the UK must invest not only in EV battery factories but also world-leading R&D and technology, Andy Palmer, ex-Aston Martin boss and former chief operating officer at Nissan, told S&P Global Platts Jan. 21.
Palmer, who now leads Switch Mobility Ltd. and is best known for his leadership of the first mainstream EV the Nissan Leaf, said in an interview that EV adoption was starting to speed up, but that the move had taken longer than he had ever envisaged.
On the matter of large EV battery factories commonly called gigaplants, he said without them some of the UK's automotive industry would be lost as the sector transitions to battery technology. However, he foresees the premium brands, such as Jaguar, remaining for the long haul.
There has been a lot of attention on local supply chains in the wake of the pandemic, and how essential they are not only to a low-carbon transition, but also for securing domestic employment. The seasoned auto executive was slightly dubious of the success rate, noting that essential raw materials like cobalt and nickel are just not in enough abundance in the UK.
On the subject of Rules of Origin, and the UK government's aim to have 50% of EV battery contents originating from the UK or Europe by 2024, Palmer said this was not a hard and fast rule applied to raw materials. It in fact encompasses the entire battery and the manufacturing of it.
"It's the cost up to the point of wholesale ... it can include local assembly, not just raw materials."
Regarding the importance of the battery industry to the energy transition, he said there was no chance of anyone "losing in terms of demand." He referred to anyone willing to make an investment in local battery production, noting that even hydrogen fuel cell technology requires a battery in its system.
He forecast that by 2030 globally, the automotive industry will be made up of 35%-40% battery technology vehicles -- either pure electric battery plug in or fuel cell. There will be hot-spots like Norway and the UK where this penetration rate will be higher.
Sales of EV passenger cars in Norway rose 27.3% year on year to 76,804 units in 2020, or a 54.3% share of overall passenger car sales, according to latest statistics from the Norwegian Road Federation.
"I'd speculate that passenger cars and buses will be predominantly pure electric, heavy duty vehicles like trucks will be powered by fuel cells, and anything bigger synthetic fuels e.g. drones/flying cars," he said.
Talking about the perceived race to secure supply of raw materials like nickel, cobalt and lithium, Palmer said "this is not a singular race ... it's a technology and R&D race as well."
2021 year of EV
One sticking point for the battery industry is the amount of carbon omitted at point of production, something Palmer stressed must be addressed for a successful net-zero target. However, he was steadfast in his affirmation that "2021 is the year of the electric car."
In an open letter published Jan. 18 to the UK Prime Minister Boris Johnson, Palmer called on the government to urgently establish a plan to build four gigafactories in the UK within the next five years, or risk losing the entire automotive industry.
Palmer cited the Brexit trade deal, which dictates that by 2026, EV batteries assembled by UK firms will only be allowed to contain 50% international content or face crippling tariffs on EV exports.
The UK government is targeting the end of sales of new gasoline and diesel cars and vans by 2030, 10 years earlier than planned, by backing car manufacturing bases in the West Midlands, the northeast and North Wales.
At present only one company is preparing to deliver the UK's first gigaplant -- startup Britishvolt.
The company confirmed late 2020 the plant will be built in Blyth, Northumberland, with construction planned to commence in summer 2021. An investment of GBP2.6 billion ($3.5 billion) is required to bring the project to fruition, marking the largest auto-related investments in the country since the 1980s.
Initial production is scheduled for 2023, with construction of further phases out to 2027 as output of EV batteries ramps up.
Britishvolt CEO Orral Nadjari told Platts the plant was "a big step forward in the UK's plans to decarbonize."
"We believe that this investment will help the country's ambitions to phase out traditional ICE [internal combustion engines] vehicles," he said. "These are no small statements and private sector and government must collaborate for success."
