The demand for a crucial component is exceeding supply, leading to a global gold rush as investors and companies rush to develop technology and factories to produce millions of electric cars. Batteries, once considered uninteresting, are now an exciting part of the auto industry. The manufacturing of cars has remained largely unchanged for 50 years and is barely profitable, but the battery industry is ripe for innovation. Technology is advancing rapidly, similar to the early days of personal computers or mobile phones, and an influx of capital could lead to the emergence of new industry leaders. Wood Mackenzie predicts that electric vehicles will account for 18 percent of new car sales by 2030. This would lead to a significant increase in the demand for batteries, surpassing current factory production capacity by approximately eight times. This estimate is considered to be conservative, as some analysts predict even faster growth in electric vehicle sales. Car manufacturers are competing to obtain the most efficient and cost-effective chemical formula that can provide the highest energy output in the smallest size. GM's recent announcement to transition to all electric vehicles by 2035 was seen as a significant milestone by policymakers and environmental advocates. Many experts in the battery industry believe that the recent announcement by the company was simply confirming the obvious - that electric vehicles are becoming more prevalent. Battery production is currently controlled by companies such as Tesla, Panasonic, LG Chem, BYD China, and SK Innovation, primarily located in China, Japan, or South Korea. However, there are also numerous new companies entering the market, with investors eagerly funding startups they believe are on the brink of significant advancements in battery technology. Andy Palmer, the former CEO 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 a surplus of funding available but a lack of innovative ideas. QuantumScape, a startup backed by Volkswagen and Bill Gates, is developing battery technology that could revolutionize the industry. However, it has not yet generated significant sales and its success is not guaranteed. Despite this, investors value the company higher than Renault. Both China and the European Union are investing in battery technology with government funds. China views batteries as essential to its goal of dominating the electric vehicle industry, leading the Chinese government to assist Contemporary Amperex Technology, a partially state-owned company, in becoming a major battery supplier on a global scale in a short amount of time. The European Union is also taking steps to support battery production in order to avoid reliance on Asian suppliers and protect jobs in the auto industry. The European Commission recently announced a 2.9 billion euro fund to aid in battery manufacturing and research, adding to the substantial financial commitments made by European governments and automakers towards electric vehicles and batteries, as reported by Accenture. Some government funding will be allocated to Tesla as a form of appreciation for the company's choice to establish a factory close to Berlin. The United States is also anticipated to support the industry in line with President Joe Biden's emphasis on addressing climate change and his endorsement of electric vehicles. Biden, who owns a 1967 Chevrolet Corvette, expressed his excitement about driving an electric version of the sports car in a campaign advertisement last year, should GM opt to produce one. Numerous battery factories are either in the planning stages or under construction in the United States, including one that GM is constructing in Ohio in partnership with LG. Analysts believe that federal incentives for electric vehicle and battery production will play a crucial role in fostering a flourishing industry in the United States. Additionally, advancements in technology by government-backed researchers and domestic companies like QuantumScape and Tesla, which announced plans last autumn to reduce costs and enhance battery performance, will also be significant in this endeavor. Margaret Mann, a group manager at the National Renewable Energy Laboratory, stated that China strongly supports manufacturing and new development. She believes that the United States has the potential to catch up in battery production, but acknowledges that there are still challenges to overcome. Entrepreneurs in the industry believe that US companies can surpass Asian producers in the future. Jagdeep Singh, CEO of QuantumScape, emphasized the need for improvements in battery technology for a renewable energy economy. Overall, the investment in battery technology is seen as a positive development. Capitalism is being used to address a global issue by reshaping the auto industry, but this transformation will have consequences for some, such as companies that manufacture parts for traditional vehicles or investors who back the wrong technology. According to Venkat Srinivasan, director of the Argonne National Laboratory's Collaborative Centre for Energy Storage Science, battery advancements take time and unexpected challenges may arise. Many believe that the demand for batteries will benefit China, as they refine most battery metals and produce 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 building a battery factory in northern Norway, stated that battery production has significant geopolitical implications. He emphasized that the European auto industry aims to reduce reliance on imports from Asia, especially China. Freyr is seeking to raise $850 million through a proposed merger with Alussa Energy Acquisition Corp., which would result in a listing on the New York Stock Exchange. The company intends to produce batteries utilizing technology created by 24M Technologies in Cambridge, Massachusetts. The primary goal for the sector is to lower battery costs. Electric vehicle batteries for a midsize car currently cost around $15,000, which is twice as much as they should be for electric cars to be widely accepted, as mentioned by Srinivasan. These cost reductions can be achieved through numerous small enhancements, such as manufacturing batteries near car plants to avoid shipping expenses, and by minimizing waste, according to Roland Berger. Approximately 10 percent of the materials used in battery production are wasted due to inefficient manufacturing processes. In a recent study, Roland Berger cautioned that the increasing demand for raw materials such as lithium, cobalt, and nickel could lead to higher prices and offset some of the efficiency gains. The automotive industry is vying for batteries with electric utilities and other energy companies to store intermittent wind and solar power, further driving up demand. Jason Burwen, interim chief executive of the United States Energy Storage Association, mentioned concerns about a potential supply shortage this year. A new wave of companies has emerged to replace expensive minerals in batteries with more affordable and abundant materials. OneD Material, located in San Jose, California, produces a substance resembling used coffee grounds for use in anodes, which are electrodes that allow power to exit batteries when a vehicle is in motion. The material is created using silicon, which is widely available and cost-effective, in order to decrease the reliance on graphite, which is rarer and more costly. In the future, the ultimate goal for the industry is solid state batteries, which will substitute the liquid lithium solution with solid layers of a lithium compound. Solid state batteries are expected to be more stable, less likely to overheat, allowing for quicker charging times, and lighter in weight. Toyota Motor Co. and other companies have made significant investments in this technology and have already achieved success in constructing some solid state batteries. The challenge lies in producing them in large quantities at an affordable price. QuantumScape has generated a lot of excitement by claiming to have discovered a material that addresses a key obstacle to mass production of solid state batteries - their susceptibility to short circuiting due to imperfections. However, most experts in the field do not anticipate solid state batteries being widely accessible until approximately 2030. Elon Musk, Tesla's CEO, emphasized the difficulty of mass producing batteries during a recent conference call, stating that creating prototypes is simple in comparison. Scaling up production is a very difficult task. It is currently a favorable time to have a degree in electrochemistry, as those who understand the properties of materials such as lithium, nickel, and cobalt are essential to the development of batteries. Individuals like Jakub Reiter, who has been interested in battery chemistry since his youth in Prague in the 1990s, are highly sought after in the industry. After being recruited by a headhunter to work at BMW in 2011 to study battery science, Reiter was later hired by InoBat to help establish a factory in Slovakia, where major car manufacturers such as Volkswagen, Kia, Peugeot, and Jaguar Land Rover are based. Reiter is currently leading the science department at InoBat, a company that specializes in developing batteries quickly for various purposes, such as affordable batteries for commuter cars or high-performance ones for roadsters. Reiter stated that two decades ago, there was little interest in batteries, but now there is fierce competition and a significant challenge in the industry.