Automotive Industry Likely to Face Materials Shortage

A decade ago, the automotive industry could not foresee a semiconductor shortage disrupting vehicle production. A decade from now, automakers may face a scarcity of materials required for EV batteries and other essential components. Shortages might even come sooner than that.

Increased electronics content in vehicles has tied automotive companies to the semiconductor industry. In 2020, semiconductor manufacturers, anticipating a seasonally soft Q4, didn’t increase output. When auto demand suddenly spiked, chip makers were unable to muster a quick reaction — aside from supply chain issues, semiconductors take 18 weeks to build. Automakers are now competing with massive chip buyers (such as consumer electronics companies) for a limited supply of chips.

Materials are similar from the perspective of pure supply and demand. The move toward zero-emission vehicles now puts materials such as graphite, cobalt, nickel and manganese in automakers’ line of sight. Demand for EVs was expected to reach nearly 2.5 million in 2020, said IHS Markit, and then rise by about 70% by 2021. The materials used in EV batteries are not easy to obtain. Graphite, which is used in the anodes of lithium-ion batteries, could become scarce as early as next year.

KEEP READING: https://www.eetimes.com/automotive-industry-likely-to-face-materials-shortage/

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