08 November 2021

Nowadays, “electric vehicle” or EV has become a buzz word for entrepreneurs in the automotive industry, as this innovation is going to play a very important role in the future. McKinsey & Company has estimated that EV will gain a market share of around 30-35% in the passenger cars segment in key markets such as China, Europe and the United States, and accounted for approximately 20-25% of global market share by the year 2030. In Thailand, the draft of the 13th National Economic and Social Development Plan presented to the Office of the National Economic and Social Development Council has indicated that the country is positioning itself as the world's major electric vehicle production base. This goal will be achieved by increasing demand for EVs to 26% by the year 2027. One of the key factors that will create this demand and enhance public adoption of this green vehicle will depend on the efficiency of "battery.”

Now, “Battery” can be regarded as either obstacle, challenge or weakness of EV industry. This is due to the fact that regardless of how many new models have been equipped with high-power battery that enables a ride of several hundreds of kilometers per one charge, drivers are still concerned when driving on a very long distance or to places that lack charging facilities. On average, most drivers travel only less than 80 kilometers per day, but if the need for a long distance arises, drivers will need to be confident that they can charge their cars easily. This means the battery industry needs to be developed in tandem the ecosystem for EV industry to move forward quickly.

In some countries such as England, the new laws have been drafted to mandate all newly constructed “buildings and houses” to install electric vehicle charging outlets to increase the number of currently existing 25,600 charging stations across the country. However, in order to raise the adoption of electric cars, the number of charging stations must increase 10 times by 2030 to align with the future demand. This is also a crucial issue for Thailand that aims to become a low-carbon society as well as ASEAN’s No. 1 automotive production base and one of the world’s top ten. The Electric Vehicle Association of Thailand (EVAT) is currently collaborating with various partners to develop an infrastructure that would enable cross-network charging stations and connectivity among different car brands. At the same time, effective communication is required to promote a concept that electric vehicles are more cost-effective than traditional cars.

One of the policies regarding Thailand’s EV industry as stated in the National Economic and Social Development Plan is that, there will be an establishment of a co-enterprise for the purpose of research and development of batteries, sensor systems, electronic systems and communication systems in electric vehicles as well as the development of technologies to capture carbon dioxide and evaluation of the product’s entire life cycle. The policies will also include the promotion of technologies related to electric vehicle modification as well as knowledge sharing to manufacturers of electric vehicles. The goal is to reach an investment in electric vehicles and parts of no less than 130 billion baht by the year 2027, an increase of at least 14 suppliers in the EV supply chain, an increase of 5,000 charging stations/fast charge outlets, and also increase investments in essential technologies for EV industry in Thailand.

The trend is not limited to just passenger cars, as EV trucks have also become popular among operators in different industries around the world. Thailand also makes headway in this trend because in June 2020, Sammitr Group received an approval of 5,500-million-baht investment from BOI for the production of battery electric vehicle (BEV) which uses rechargeable batteries without a secondary battery source. The production target is 30,000 units per year for domestic sales, with primarily local raw materials used in the production lines with the value up to approximately 8,500 million baht per year. The project will kick off with the production of 6-wheel, dry-refrigerator trucks with a 200-kWh lithium-ion battery, an ability to cover a distance up to 300 km, and various industrial applicability according to customers’ particular needs. These trucks will be available to the market in five years and will target logistics industry in addition to general consumer market. This movement will enable various entrepreneurs to transform their businesses towards Net Zero successfully.

The demand for EV batteries is growing exponentially. In 2020 alone, the demand reached 110 GWh and is expected to rise by 600 times over the next 30 years to 6,530 GWh by the year 2050. Currently, China is the leading powerhouse in lithium-ion battery production. This is not surprising since 77% of the world's largest battery factories are located in China. Although Europe is planning to increase their investment in lithium-ion battery facilities, China will still dominate global lithium-ion battery production. It is estimated that by 2025, China will produce approximately 65% of the world's lithium-ion batteries, while Europe’s production accounts for approximately 25%.

In Thailand, there is a number of key players in EV battery production such as Banpu that invests in a joint-venture with Dura Power Holdings who specializes in the design, manufacture and installation of Li-ion battery (LiB) for vehicles and various backup power systems, GPSC-a PTT’s subsidiary that invests in the manufacturing facilities of G-Cell energy storage to produce and distribute LFP batteries for small and large electric vehicles, Bangchak which joins partnership with European partners to invest in battery facilities, and Amita Technologies Inc. who collaborates with Energy Absolute (EA) and Beta Energy Solutions, both of which will invest in the production of lithium-ion batteries.

The EV battery is an up-and-coming industry with many facets that require further in-depth studies. For example, to really drive the eco-friendly trend with electric vehicles, the recyclability of the battery is also important because cell phone batteries are classified as hazardous waste. According to a report by IMP Process Metallurgy and Metal Recycling, RWTH Aachen, Germany, more than half a million units of these batteries will expire in 2022. As a result, the market value of the battery recycling will be as high as USD 2 billion.

In conclusion, the EV industry should be monitored and followed closely. Please keep your eyes out for other news related to EV and interesting industrial movements in the future Manufacturing Expo Blogs.