Report urges U.S. to build EVs to counter China

Source: By David Ferris, E&E News reporter • Posted: Monday, September 28, 2020

A new report asks American political leaders to adopt a comprehensive plan to produce electric and automated vehicles to protect jobs and fend off a strategic threat from China.

The report was published late last week by Securing America’s Future Energy (SAFE), a group of corporate executives and ex-military commanders that has long advocated reducing reliance on oil as a security issue.

The United States “must put millions of EVs on the road quickly, to achieve the scale that will ensure a prominent global manufacturing and supply chain position,” the report said.

SAFE detailed how China is methodically building a supply chain for advanced vehicles, from minerals to batteries, from electric taxis to buses, and from semiconductors to 5G networks.

Failure to make a competing plan, the report said, could move the center of gravity of the automotive industry from North America to China. That would sap America’s ability to innovate, including in military technology, and over time cost millions of jobs.

“Beijing’s ambitions threaten the viability of the entire U.S. automotive and truck manufacturing industry, or at least have provided China with a tremendous competitive advantage,” the report said.

Arriving just weeks before the U.S. presidential election, the study hits on key themes of Donald Trump’s presidency and the policies of Democratic presidential nominee Joe Biden.

It frames China as an international aggressor the way that Trump has, describing how the country has used its enormous consumer market as leverage to access American technology.

It dwells on how Huawei Technologies Co. Ltd., the Chinese telecommunications and electronics giant shut out of the American market last year by the Trump administration and Congress, is leading on 5G, the communications protocol that could enable automated cars.

At the same time, SAFE called for increasing subsidies for the production and purchase of electric vehicles and the building of EV charging networks. These are integral parts of Biden’s $2 trillion clean energy plan.

The report allowed that the United States comes to the competition with substantial advantages.

Private American industry is the leader in autonomous driving technology. The U.S. semiconductor industry is robust. General Motors Co. and Ford Motor Co. are investing billions in EVs, though nowhere near the levels that China is.

China, meanwhile, lacks a legacy as an oil producer or a maker of internal-combustion engines — and is effectively filling that blank slate.

It mines much of the world’s graphite and nickel, and Beijing has looked abroad to lock in steady supplies of elements essential to EV batteries, like lithium and cobalt. All are key ingredients of EV batteries.

China is also overwhelmingly dominant in processing rare earth elements, which are used to make the magnets in electric motors.

Moving up the supply chain, China has also become the main supplier of EV batteries and their components. It makes 73% of lithium-ion batteries, 61% of cathodes and 83% of anodes, according to data from Benchmark Mineral Intelligence cited in the report.

SAFE makes a thicket of recommendations to stimulate production and processing of critical minerals in the United States or among its allies. It also calls for a clearer federal road map for automated vehicles and closer coordination between government and private industry to counter China’s industrial practices.

“China, with its increasingly assertive stance on the international stage, is challenging the United States for global leadership over the next generation of mobility,” the report said.