Canada can be competitive in cell manufacturing but needs to move decisively to avoid missing “the opportunity of a generation,” according to expert panelists speaking in the fourth episode of our discussion series on Canada’s potential to develop a national EV battery supply chain
Electric Autonomy Canada hosted the fourth panel of a six-part series on Canada’s national EV battery supply chain this week with guest moderator, Ryan Castilloux, Managing Director of Adamas Intelligence. Click the image above to watch the full recording.
Flavio Volpe, President of the Automotive Parts Manufacturers’ Association; Sankar Das Gupta, Chairman, CEO and Co-Founder, Electrovaya; and Adrian Tylim, Business Development Americas, Blue Solutions joined as expert panelists.
The focus was on active materials and cells, and panelists discussed what Canada needs to fill in existing gaps in manufacturing capabilities, the country’s considerable growth potential in the sector and why we need to take action now to seize the opportunity to become leaders in the market.
A ticking clock
Volpe kicked off the discussion by pointing to the importance of the 2030s for electric vehicles saying companies like General Motors, Ford, Toyota and Honda are “tripping over themselves” to further electrify their fleets by 2030 and are motivated by EV commitments in jurisdictions like Japan, Europe and California.
To keep up, Volpe said, “we need to get our house in order yesterday,” adding that Canada has a two year timeframe to “establish firmly that we are either raw material suppliers, or we are cell suppliers…otherwise those decisions will be made in other places.”
Das Gupta pointed to cell manufacturing as the critical sector for Canada to develop in order to consolidate a value-added, battery supply chain.
Material suppliers and cell manufacturers must work closely together, with “decisive research and engineering talent behind them,” according to Das Gupta. This is because of the “finicky” specificity of cell battery technology as well as the fact that production costs are driven by technology.
“Canadian policy should support folks or companies who are headquartered here, or who have substantial technology and development people here who can drive the innovation, and ultimately to become the world leader in this market.”
Tylim agreed, adding companies like his need government support to be competitive, particularly with the large investments coming out of the U.S. and incentives — both for consumers to buy EVs, and companies in Canada to use native manufacturing — will be “essential.”
He added: “I don’t think there’s enough to provide pressure on the local companies to take advantage of what we really have in Canada.”
The role of the U.S.
Panelists also pointed to the importance of the U.S. market for Canadian EV manufacturing, and subsequently of deals like Canada-United States-Mexico Agreement (CUSMA) Flavio Volpe said that 75 per cent of vehicles produced in Canada go to consumers south of the border, so the growth in EV volumes will are driven by that market.
Volpe says that because of the size of battery packs, it’s not logistically attractive for companies to import Canadian batteries to U.S. plants. This means Canada has “a real shot” to invest in the country’s five existing original equipment manufacturers, or for competing manufacturers to share battery chemistry in order to pool demand if they don’t have enough individually.
Das Gupta says the U.S. “Buy America” stance in CUSMA has to include Canadian products for any cell factory here to have a continental market.
Race to fill the gap, develop technology
Volpe says that federal and provincial governments have to understand when it comes to shoring up manufacturing that, “that space in the middle is going to work by itself.”
He said even though Canada will likely always make cars and produce natural battery materials, if the value-added products aren’t made here “we’ve missed the opportunity of a generation.”
Das Gupta points to technology as another important “play” for Canada, with emerging developments like electrodes that could improve energy density, reduce the use of toxic chemicals and ultimately reduce costs for production.
“The race for batteries themselves is wide open. There [are] no winners yet,” he said, adding that if Canada picks some “winners” and invests in domestic companies with strong research and engineering talent, the country can move away from dependence on branch plants and become one of a handful of global leaders in the field.
Electric Autonomy’s next panel discussion on Pack and Vehicle Assembly will take place on June 29. You can register for the event here.