The demand for batteries used in electric cars is exceeding supply, leading to a global competition among investors, companies, and startups to develop the technology and infrastructure for mass production. While batteries were once considered uninteresting in the auto industry, they are now seen as a key player in driving innovation. Unlike car manufacturing, which has remained largely unchanged and unprofitable for decades, the battery industry presents opportunities for growth and advancement. The rapid evolution of battery technology resembles the early days of personal computers, mobile phones, and automobiles, with the potential to create new industry leaders. Wood Mackenzie predicts that electric vehicles will account for 18 percent of new car sales by 2030. It is estimated that the demand for batteries could increase by eight times more than current factory production capacity, with some analysts predicting even faster growth in electric vehicle sales. Car manufacturers are competing to find the most efficient and cost-effective battery technology. GM's recent announcement to go all-electric by 2035 was seen as a significant milestone by policymakers and environmentalists. Many people in the battery industry considered the company's statement about electric vehicles being here as obvious. Venkat Viswanathan, an associate professor at Carnegie Mellon University who studies battery technology, noted that this announcement was part of a series signaling the presence of electric vehicles. The battery manufacturing sector is mainly controlled by companies like Tesla, Panasonic, LG Chem, BYD China, and SK Innovation, with most of them located in China, Japan, or South Korea. However, there are also numerous new players entering the market, and investors are investing heavily in startups that they believe are on the brink of significant advancements due to the potential for substantial profits. Andy Palmer, the former CEO of Aston Martin and current nonexecutive vice chairman of InoBat Auto, believes that the battery industry is still in its early stages with more funding available than innovative ideas. QuantumScape, a startup backed by investors like Volkswagen and Bill Gates, is developing technology to improve battery cost, reliability, and charging speed, despite having no significant sales yet. Despite the risk of failure, stock market investors value QuantumScape more than Renault. Both China and the European Union are investing government funds into battery technology. China considers batteries to be essential for its goal of dominating the electric vehicle industry. In response, the Chinese government assisted Contemporary Amperex Technology, a partially state-owned company, in becoming one of the largest battery suppliers worldwide in a short period of time. The European Union is also taking steps to support battery production in order to prevent reliance on Asian suppliers and protect jobs in the auto industry. The European Commission recently announced a 2.9 billion euro fund to aid battery manufacturing and research, in addition to the significant investments already made by European governments and automakers in electric vehicles and batteries, estimated at over 60 billion euros by Accenture. Some government funding will be allocated to Tesla as a way to acknowledge the company's choice to construct a factory near Berlin. The United States is also anticipated to support the industry in line with President Joe Biden's priorities on climate change and electric vehicles. Biden, who drives a 1967 Chevrolet Corvette, expressed interest in driving an electric version of the car in a campaign advertisement. Numerous battery factories are in various stages of planning or construction in the United States, with analysts emphasizing the importance of federal incentives for electric car and battery production for the industry to thrive. Additionally, advancements in technology by government-funded researchers and domestic companies like QuantumScape and Tesla are expected to play a crucial role in reducing costs and enhancing battery performance, as outlined by Tesla in its plans last fall. Margaret Mann, a group manager at the National Renewable Energy Laboratory, acknowledged China's strong emphasis on manufacturing and new development. She remains hopeful about the United States' potential to make progress in battery production but believes that there are still challenges to overcome. Entrepreneurs in the field believe that American companies have the opportunity to surpass Asian producers in the industry. Jagdeep Singh, CEO of QuantumScape, emphasized the need for improvements in battery technology for a renewable energy economy. Despite the challenges, the investment in battery technology is generally seen as positive. It utilizes capitalism to address a worldwide issue, but this restructuring of the automotive industry will have negative consequences for certain companies and investors. According to Venkat Srinivasan, director of the Argonne National Laboratory’s Collaborative Centre for Energy Storage Science, battery advancements take time and unexpected obstacles can arise. Many experts believe that the increasing demand for batteries will benefit China, as they refine most metals used in batteries and manufacture the majority of battery cells. According to projections by Roland Berger, a German management consulting firm, China's dominance in battery production is expected to only slightly decrease over the next decade despite plans to expand production in Europe and the United States. Tom Einar Jensen, the CEO of Freyr, which is constructing a battery factory in northern Norway to capitalize on the region's abundant wind and hydropower, stated that battery production has significant geopolitical implications. Jensen also mentioned that the European auto industry is aiming to reduce its reliance on imports from Asia, particularly China. Freyr is seeking to raise $850 million through a proposed merger with Alussa Energy Acquisition Corp., a shell company that sold shares before acquiring any assets. If the deal, announced in January, goes through, Freyr will be listed on the New York Stock Exchange. The company intends to manufacture batteries utilizing technology created by 24M Technologies in Cambridge, Massachusetts. The primary focus for the industry is to lower the cost of batteries. According to Srinivasan, electric car batteries for a midsize vehicle currently cost around $15,000, which is approximately double the price necessary for electric cars to gain widespread acceptance. These cost reductions can be achieved through various small improvements, such as producing batteries near car manufacturing plants to minimize shipping expenses, and by decreasing waste, as noted by Roland Berger. Inefficient production methods result in approximately 10 percent of materials used in battery production being wasted. However, a recent study by Roland Berger has cautioned that the increasing demand for raw materials such as lithium, cobalt, and nickel could lead to higher prices, potentially offsetting some of the efficiency gains. The automotive industry is in competition for batteries with electric utilities and other energy companies seeking to store intermittent wind and solar power, further driving up demand. Jason Burwen, interim chief executive of the United States Energy Storage Association, has expressed concerns about a potential supply shortage this year. A new wave of companies has emerged to replace costly minerals in batteries with more affordable and readily available materials. For example, OneD Material, located in San Jose, California, produces a substance resembling used coffee grounds for use in anodes, which are the electrodes that power exits through when a vehicle is in motion. The substance is created using silicon, which is readily available and cost-effective, in order to lessen the reliance on graphite, which is rarer and more costly. In the future, the ultimate goal for the industry is solid state batteries, which would substitute the liquid lithium solution in current batteries with solid layers of a lithium compound. Solid state batteries are expected to be more stable, less susceptible to overheating, and capable of faster charging. Additionally, they would have a lighter weight. Toyota Motor Co. and other companies have made significant investments in this technology and have already managed to develop some solid state batteries. The challenge lies in producing them in large quantities at an affordable price. QuantumScape is generating a lot of excitement because they claim to have discovered a material that addresses a major obstacle in mass producing solid state batteries - the risk of short circuiting due to imperfections. Despite this advancement, most experts predict that solid state batteries won't be widely accessible until roughly 2030. Elon Musk, the CEO of Tesla, acknowledged the difficulty of mass producing batteries, stating that creating prototypes is simple in comparison. Scaling up production is very challenging. Having a degree in electrochemistry is currently in high demand, as those who possess knowledge of materials like lithium, nickel, and cobalt are crucial to the battery industry. For example, Jakub Reiter, who has been passionate about battery chemistry since his teenage years, was recruited by BMW in 2011 to work on battery science research. Recently, he was hired by InoBat to assist in establishing a factory in Slovakia, where various car manufacturers such as Volkswagen, Kia, Peugeot, and Jaguar Land Rover operate. Reiter is currently leading the science department at InoBat, a company that specializes in technology that enables customers to efficiently create batteries for various purposes, such as a cost-effective option for a commuter vehicle or a high-performing version for a sports car. According to Reiter, there was little interest in batteries two decades ago, but now there is significant competition and a fierce battle for market share.