The demand for batteries used in electric cars is currently higher than the supply available. This has sparked a global race among investors, companies, and startups to develop the technology and build factories to produce millions of electric cars. Batteries, once seen as uninteresting, are now considered one of the most exciting parts of the auto industry. While car manufacturing has remained largely unchanged and unprofitable for decades, the battery industry is primed for innovation. The rapid evolution of battery technology is comparable to the early days of personal computers, mobile phones, and automobiles. With increased investment, there is potential to create industry giants like Steve Jobs or Henry Ford. Wood Mackenzie predicts that electric vehicles will account for 18 percent of new car sales by 2030. The demand for batteries is expected to increase significantly, possibly up to eight times more than current production capacity. This estimate is considered conservative, as some analysts predict even faster growth in electric vehicle sales. Car manufacturers are competing to find the most efficient and cost-effective chemical composition for batteries. GM's recent announcement of plans to go all electric by 2035 was seen as a major milestone by policymakers and environmentalists. Many individuals in the battery industry found the company's recent announcement to be stating the obvious, as it signaled the presence of electric vehicles. According to Venkat Viswanathan, an associate professor at Carnegie Mellon University specializing in battery technology, companies like Tesla, Panasonic, LG Chem, BYD China, and SK Innovation dominate battery manufacturing, with most of them located in China, Japan, or South Korea. Despite this, there are several new players entering the market, and investors are eagerly funding startups they believe are on the verge of major advancements due to the potential profits involved. Andy Palmer, the former chief executive of Aston Martin and current nonexecutive vice chairman of InoBat Auto, believes that the electric vehicle industry is still in its early stages. There is an abundance of funding available, but not enough innovative ideas to invest in. QuantumScape, a startup backed by Volkswagen and Bill Gates, is developing a technology that has the potential to revolutionize batteries by making them more affordable, reliable, and faster to recharge. However, the company has yet to generate significant sales and there is a risk of failure. Despite this, stock market investors have valued QuantumScape higher than Renault. Both China and the European Union are also investing government funds into battery technology. China considers batteries to be essential for its goal of dominating the electric vehicle sector, leading the government to assist Contemporary Amperex Technology in becoming a major battery supplier. In response, the European Union is providing subsidies for 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 support battery manufacturing and research, adding to the significant investment already made by European governments and automakers in electric vehicles and batteries. Some of the government funding will be allocated to Tesla as a way to acknowledge the company's decision to establish a factory near Berlin. The United States is also anticipated to support the industry in line with President Joe Biden's focus on climate change and his endorsement of electric vehicles. In a campaign advertisement last year, Biden, who possesses a 1967 Chevrolet Corvette, expressed his excitement about driving an electric version of the sports car if GM opts to manufacture one. Numerous battery factories are currently in the planning or construction stages in the United States, including a facility being developed by GM in Ohio in partnership with LG. Analysts believe that federal incentives for electric vehicle and battery production will be essential in fostering a thriving industry in the United States, along with advancements in technology by government-funded researchers and domestic companies like QuantumScape and Tesla, which recently outlined plans to reduce costs and enhance battery performance. Margaret Mann, a group manager at the National Renewable Energy Laboratory, acknowledged China's strong promotion of manufacturing and new development. She remains hopeful about the United States catching up in battery production but believes that there are still challenges to overcome. Entrepreneurs in the industry believe that US companies have the potential to surpass Asian producers, despite the current lack of competitiveness in battery technology. QuantumScape's CEO Jagdeep Singh emphasized the importance of improving battery technology for a renewable energy economy. Overall, the significant investment in battery technology is seen as a positive development. It utilizes capitalism to address a global issue, but the restructuring of the automobile industry will have negative consequences for some, such as companies that produce parts for traditional cars and investors who back the wrong technology. According to Venkat Srinivasan, director of the Argonne National Laboratory’s Collaborative Centre for Energy Storage Science, advancements in battery technology take time and unforeseen challenges may arise. Many believe that the demand for batteries will benefit China, as the country refines most metals used in batteries and manufactures the majority of battery cells. According to projections by Roland Berger, a German management consulting firm, China's control over battery production is expected to only slightly decrease in the next decade despite plans to expand production in Europe and the United States. Tom Einar Jensen, the CEO of Freyr, emphasized the geopolitical significance of battery production, stating that the European auto industry is aiming to reduce reliance on imports from Asia and China. Freyr, which is constructing a battery factory in northern Norway to utilize the region's renewable energy sources, is seeking to raise $850 million through a proposed merger with Alussa Energy Acquisition Corp. This deal, announced in January, would result in Freyr being listed on the New York Stock Exchange. The company intends to produce batteries using technology created by 24M Technologies in Cambridge, Massachusetts. The primary goal for the industry is to lower the cost of batteries. Electric car batteries for a midsize vehicle currently cost around $15,000, which is twice as much as they should be for electric cars to become widely accepted, according to Srinivasan. These cost reductions can be achieved through various small improvements, such as manufacturing batteries near car factories to avoid transportation expenses, and by minimizing waste, as stated by Roland Berger. Approximately 10 percent of the materials used to make a battery are wasted due to inefficient production methods. In a recent study, Roland Berger cautioned that an increase in demand may lead to higher prices for raw materials such as lithium, cobalt, and nickel, potentially offsetting efficiency gains. The automotive industry is facing competition for batteries from electric utilities and other energy companies seeking to store wind and solar power, further driving up demand. Jason Burwen, the interim CEO of the United States Energy Storage Association, has suggested that there may be a supply shortage this year. To address this issue, companies are developing alternatives to expensive minerals used in batteries, opting for cheaper and more readily available materials. One such company, OneD Material in San Jose, California, has created a substance resembling used coffee grounds for use in anodes, the component of batteries that conducts power during vehicle operation. The material is manufactured using silicon, which is plentiful and cost-effective, in order to decrease the reliance on graphite, which is rarer and more costly. In the long run, the ultimate goal for the industry is to develop solid state batteries that would replace the liquid lithium solution in current batteries with solid layers of a lithium compound. Solid state batteries are anticipated to be more stable and less susceptible to overheating, leading to quicker charging times and lighter weight. Toyota Motor Co. and other companies have made significant investments in this technology and have already achieved success in producing some solid state batteries. Producing solid state batteries in large quantities at an affordable price is the challenging aspect. QuantumScape has generated excitement by claiming to have discovered a material that addresses a major obstacle in mass producing solid state batteries - their tendency to short circuit due to imperfections. Despite this breakthrough, the industry anticipates that solid state batteries will not be widely accessible until approximately 2030. Tesla's CEO, Elon Musk, stated that mass producing batteries is incredibly difficult, emphasizing that creating prototypes is a much simpler task. Scaling up production is a challenging task, but having a degree in electrochemistry is currently very advantageous. Those who have knowledge of materials like lithium, nickel, and cobalt are essential to the battery industry, similar to how software coders are crucial to the computer industry. For example, Jakub Reiter has had a passion for battery chemistry since he was a teenager in Prague in the 1990s. Despite it not being a popular career choice at the time, he was recruited by BMW in 2011 to study battery science. Recently, he was hired by InoBat to help establish a factory in Slovakia, where several car manufacturers such as Volkswagen, Kia, Peugeot, and Jaguar Land Rover are located. Reiter currently holds the position of head of science at InoBat, a company that specializes in developing batteries for various purposes such as affordable batteries for commuter cars or high-performance ones for roadsters. According to Reiter, the importance of batteries has significantly increased over the past two decades, leading to intense competition in the industry.