[Source/Observer Network, Chen Sijia] "Starting from zero is impossible; Europe must embrace China." According to a report by the Financial Times on May 27, executives from two major European metal companies recently stated that European enterprises have fallen far behind China in battery technology, and they lack the ability to compete with Chinese companies. They believe that Europe must face reality and actively seek cooperation with Chinese enterprises.

The report noted that with the Swedish battery manufacturer Northvolt filing for bankruptcy in March this year, Europe's ambition to build a local battery industry has suffered a severe blow. Executives from both Eramet Group of France and Umicore Group of Belgium believe that Europe cannot develop a "fully independent battery industry."

Christel Bories (Christel Bories), former CEO of Eramet Group who just stepped down last week, said that Europe needs to recognize the reality. China has spent more than twenty years perfecting battery technology and has already taken a significant lead over Europe. She frankly stated that attempting to develop a battery industry "from scratch" without relying on Chinese technology is unfeasible.

Bart Sap, CEO of Umicore Group, agreed with Bories' view. He said, "We must embrace China and let them help us produce batteries together in Europe." Sap believed that instead of imposing tariffs on Chinese enterprises, Europe should encourage cooperation and promote localized production in Europe. "This is the key to future development."

Swedish battery manufacturer Northvolt filed for bankruptcy in March this year. Visual China

These two companies are both major European mining giants; Eramet Group produces some metals used in battery manufacturing, while Umicore Group focuses on the production and recycling of battery materials. Both Bories and Sap agreed that Europe should not compete with leading Chinese enterprises like battery manufacturer CATL and automobile manufacturer BYD but should seek cooperation to establish supply chains and invest in local production in Europe.

Rob Burrell (Rob Burrell), a battery supply chain researcher at market research company Project Blue, also stated that for the European battery industry, "complete disengagement" with China is unrealistic.

Some Chinese enterprises have begun investing in Europe and establishing partnerships with local enterprises. For example, CATL announced last year its cooperation with the European automotive giant Stellantis to invest 4.1 billion euros in building a battery factory in Spain. BYD has established its first European passenger vehicle production base in Hungary, expected to begin operations by the end of 2025.

The Swedish battery manufacturer Northvolt, which European countries had high hopes for, filed for bankruptcy in March this year, severely undermining Europe's ambition to build a domestic battery industry. The Financial Times previously wrote an article pointing out that the remaining battery enterprises in Europe, such as France's ACC and Germany's PowerCo, now face the question of whether they can develop independently or need to cooperate with Chinese enterprises.

Bloomberg analysis stated that China supplies approximately 80% of the world's lithium-ion batteries, and six of the world's top ten electric vehicle battery manufacturers come from China. The setback in Europe's efforts to develop a battery industry may force the EU to "open the door" to Chinese enterprises, build more battery factories in Europe, and ensure that Europe can continue to push for the transformation of electric vehicles.

Before Northvolt filed for bankruptcy protection in the United States in November last year, Zeng Yubing, founder and CEO of CATL, known as the "King of Batteries in China," made a sharp observation about the problems of European battery manufacturers during an interview hosted by Nicky Thoenes, CEO of Norway's Sovereign Wealth Fund: "Their design is inadequate, their processes are wrong, and even their equipment has issues. How can they expand production?" He pointed out that these enterprises will face utilization, reliability, and even safety issues when expanding production scale.

The Financial Times believes that Zeng Yubing's pessimistic evaluation reveals the extent of the failure of Europe's decarbonization key technology industries. European governments, businesses, and investors no longer know how to recompete with China.

Lucas de Meo, CEO of French automaker Renault Group, told the media, "We need to reach an agreement with China. Chinese companies control mining, chemical processing, and refining. Without their capacity and capability support, we will be unable to compete."

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Original source: https://www.toutiao.com/article/7509457060011049483/

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