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Is Obama’s expectation of a 40% US Marketshare of Vehicle Battery Industry Realistic?

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President Obama has said that USA expects to capture 40% global marketshare of the EV/Battery Industry by 2015.This claim is predicated on the Massive Subsidies that DOE has recently given to Battery Companies.This will help in increasing the USA marketshare from 2% last year to 40% by 2015.However this claim by Obama looks to be full of holes.Just like the Misguided Solar Policy,the USA administration is wrong about the Battery Marketshare.Instead of fully focusing the Green Stimulus Dollars on Technology Development,it is being thrown about in loan grants to manufacturing and projects which will lead to no technology development.The Massive Loan Guarantee to Abengoa and Abound Solar was a prime example of the misguided policy.

USA has granted/will grant $2.4 billion in Total for EV Industry with $1.5 Billion for Batteries

DOE has granted/will greant 2.4 Billion for the EV Industry of which  $1.5 Billion in meant for Battery Technology and Manufacturing.Johnson Controls and A123 Systems are the largest beneficiaries of this Subsidy with Ener1,LG Chemicals and Saft being the other winners.This Subsidy has been done to encourage Battery Manufacturing is the USA which is currently dominated by Asian Suppliers.

Obama opens spigot on plug-in electric-car grants – CNET

President Barack Obama on Thursday launched a $2.4 billion program to boost development of plug-in electric vehicles in the U.S., including grants to finance domestic production of auto batteries.Obama spoke at Southern California Edison’s Electric Vehicle Technical Center in Pomona, Calif., where he said the Department of Energy has now started taking grant proposals from electric-vehicle battery makers.

The stimulus plan passed earlier this year set aside $2 billion to jump-start electric-vehicle manufacturing. Out of that total, $1.5 billion is available for U.S. battery manufacturing and $500 million for related technology, such as electric motors.The Department of Energy is making another $400 million available to build and test the infrastructure needed for plug-in electric vehicles. This includes charging stations and training for technicians in electric vehicles.The funding will help meet the president’s goal of 1 million plug-in vehicles by 2015 and position U.S. companies for the next wave of transportation technology, Obama said

Reasons Why Obama is Wrong

While US marketshare will increase due to these massive grants,I am pretty sure that USA won’t get to 40% marketshare.Here are the following reasons

1) Other Countries have Huge Subsidies in Place Too – China has rolled out even bigger $15 Billion Subsidy to create Electric Vehicle Champions.China is already a Leader in the Battery business with Honda looking towards Chinese technology.Japan is also unlikely to lose much marketshare as Toyota and Nissan look set to capture a big chunk of the EV business.Japanese automakers typically source their batteries from¬† Japanese firms.While Panasonic is already a leader,Toshiba and NEC are also looking to enter the business big time.South Korea’s LG Chem has also won large contracts for its Batteries.

2) Expensive to Transport Batteries – Coda Automotive is setting up a Battery Plant in Pennsylvania using Chinese technology.The reason is that it is too expensive to move Batteries from China to USA.The reverse also applies.With large part of the global manufacturing taking place outside USA,it makes little sense to locate 40% of global Battery Capacity in USA.

Obama says U.S. expects to boost battery business – Reuters

In an interview with CNBC-TV, Obama said automakers are embracing new technologies to make more fuel efficient vehicles, including electric cars.”We also creating an entire advanced battery manufacturing industry in the United States. We used to have 2 percent of that market. By 2015, we expect to have up to 40 percent of that market,” Obama said after touring a Ford Motor Co plant in Chicago.


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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