E-mobility – How is it expected to impact Metalworking suppliers?

E-mobility (Electromobility) is an eco-friendly, lightweight, and digital automotive technology. It is the application of electric energy to run automobiles for transportation. Electric Vehicles are powered by batteries or through an on board-generator or through a plug-in source feed.

In most countries around the world, the legislative requirements strongly imply manufacturing industries to rely on eco-friendly regulations. The automotive industry, being the largest contributor of air pollution to the environment through its fuel emissions, is subjected to a prime focus on making a huge shift in its manufacturing strategy. As a resulting innovation, E-mobility or Electromobility started to rise as a solution for CO2 neutral automotive manufacturing. The big question here for the metalworking manufacturers is the impact of the e-mobility trend on the metalworking market!

Upcoming in this article are a few discussions this article will make in terms of metalworking and e-mobility through answers for the major questions. This article includes:

  1. How are Metalworking and E-mobility correlated?
  2. What parts of an electric vehicle are reigned by metals or metal parts?
  3. Is E-mobility a threat to the metalworking economy?
  4. What can metalworking manufacturers expect from the E-mobility market on the road ahead?
  5. Conclusion
  6. References

Let’s get quick into the details!

  1. How are Metalworking and E-mobility correlated?

Automotive industry is one of the independent and self-provisioning fields in the globe. With E-mobility emerging to be a leading technology in the industry, there is a major impact on the global supply chain. The introduction of electricity into the infrastructure brings in opportunities to digitalise features to an enormously alarming range. Undoubtedly, automotive sector is highly dependent on the metalworking market for majority of its crucial components. In turn, the economy of the metalworking market is largely contributed by the automotive industry.

Wonder how?

The automotive that run on fuels require up to 1400 functional parts, majority of which are made of metals like Aluminium, Steel and Magnesium. This triggers the demand of metals with increase in the demand for automotive by consumers.

Contrastingly, the electric vehicles are much simpler in infrastructure requiring only up to 200 parts. This point of reduced demand for metal parts by electric vehicles however is compensated by the charging facility components that require metals for their manufacture.

This changeover of technology though is considered disruptive, on the other hand is expected to make way for new opportunities for metalworking manufacturers. The recycling of scrap or used metal as a resultant of the technology shift, is about to emerge as an active business unit in the automotive market. Consequently, it is expected to give a larger bloom to the metalworking market.

Thereby, E-mobility and metalworking can be considered as two inseparable and inter-dependent entities of the automotive industry. With the idea of the association between these 2 markets, let’s look into the details of the physical contribution of metals for an electric vehicle.

2. What parts of an electric vehicle are reigned by metals or metal parts?

Metals being a good conductor of heat and electricity, with strong and lightweight features, is considered as the best material to manufacture electric cars. Most parts of an EV is manufactured by metals that are considered to best possess the above-mentioned features.

Here are a few metals that play a major role in the making of an electric vehicle:

Aluminium

Aluminium is a leading material in e-mobility production. A majority of aluminium is used to construct battery housings that is recently individually is evolving as a game changing market. In an electric vehicle, it is found in engine blocks, body panels, wheels, pistons and cylinders. It is estimated that almost 330 pounds of Aluminium is used in electric vehicle production.

The primary aluminium production is dominated by China with an estimation of 60000 thousands of metric tons followed by India and Russia.

Steel

Undoubtedly, Steel is the most required metal for the construction of vehicle body, battery housings, engine parts, chassis, fasteners, exhaust, brakes and many other parts. This ‘Material of Mobility’ is known for its flexibility and durability without breaking making it a highly crucial element of EV manufacturing. Its high capacity to resist rust makes EV last for long.

According to the World Steel association, almost 55% of the body weight of a electric car is contributed by Steel. In an average an electric car utilises upto a 2400 pounds of steel for a complete production.

China is the world’s leading producer of crude steel up to an estimation of 808.4 million metric tons. It is followed by countries like Japan, India, The United States of America, Russia, South Korea and Germany.

Titanium

Titanium is generally an expensive metal utilised by Automotive giants like Tesla. The strength of the metal makes it super hard and is found in the applications like battery pack protection, engine pumps, intake and exhaust valves. Though it is a very strong metal in terms of production, it is also fairly glorified for its equally important light-weight. This makes manufacturers find the metal as the most efficient for quality structure of cars.

China is the world’s largest producer of Titanium with a production unit of up to 170000 MT followed by Japan and Russia.

Copper

Similar to other electrical applications, copper finds its contribution to the manufacture of wires and motors for an EV. Since it is a very good conductor of electricity, undoubtedly battery chargers (both residential and public) are made of copper.

It is also used in the production of transformers, cables, conditioning systems, mirrors and in energy storage components.

It is estimated that EVs are manufactured with a minimum of 20 lb to a maximum of 180 pounds of copper depending on the type of drive constructed.

Chile is the world’s largest producer of copper with an estimation of 5.6 million metric tonnes. It is followed by other leading copper producers like Peru, China, Australia, the United states, Zambia, Mexico and Russia.

Lithium

As far as it is forecasted, batteries in an EV can only be constructed using lithium-ion. This unchangeable chemistry of battery production, makes lithium the most essential metal as an EV requirement. A compact battery uses upto a 9 lb (4 kg) of lithium.

Its largest availability is marked in Chile with a marginal estimation of 8.6 million metric tons followed by Australia with a reserve of 2.8 million metric tonnes.

The reasons that the lithium-ion is the dominant part of an electric vehicle battery are:

  • Lithium is a good performer even at high-temperatures
  • Efficient energy storage and driving capacity
  • Environmental friendly when compared to fossil fuel drives
  • High power-to-weight ratio

Nickel

Nickel acts as a determiner of a power and range of a battery. If a manufacturer wants to increase the power or range, he adds more nickel to the cathode. The class-one nickel is considered as the highly pure metal in the industry.

The consumption of nickel is reaching a peak and is forecasted that the surge in the demand is an outstripping threat to the supply in the coming years. About 80% of a battery is made of Nickel (Nickel Cobalt Aluminium). The Nickel Manganese Cobalt are also surging up to 80% for application in batteries recently.

Indonesia is the world’s largest producer of Nickel with up to an estimation of 4 lakh metric ton production followed by Philippines, Russia, Australia, New Caledonia, Canada.

Cobalt

Cobalt can be mentioned as a stabilising agent of an EV battery. It’s composition in the cathode of a battery decides the life cycle of the charging capacity. Almost a 4 to 30 kg of cobalt is required by an Electric vehicle.

Since Cobalt is a critical raw material, the forecasts predict that the supply may outstrip supply around next few years due to a threefold demand by the electric vehicle producers. However, it is also considered that the exhaustion may be pacified until 2030 beyond which closure of cobalt mining is expected if no additional reserves are discovered.

Presently, the Democratic Republic of Congo is the largest producer of Cobalt in the world with an estimation of about 100,000 Metric Ton. It is followed by mining facilities at Russia, Australia, Philippines, Cuba and Madagascar.

3. Is E-mobility a threat to the metalworking economy?

The recent evident changes due to the transitions towards electrification of the automotive industry has initiated a shift in the financial aspects of the metalworking industry. However, this shift has raised the demands in the supply of pure metals causing a uptake in the mining and production opportunities. This ensures that the shift is definitely not a threat to the metalworking economy though it has disrupted the usual curve of the financial graph.

The recent global pandemic is a reason that the shift is slow but steadily maintained. On the other hand, the conventional production of internal combustion engine based vehicles is not drastically reduced. Thereby, a positive flow of change is observed in the transition aspects.

BloombergNEF has estimated that the global electric-vehicle sales will rise to 8.5 million by 2025 and will increase to a 62 million by 2030. This ensures that the metal industry is parallel will have an appraisal in the demands eventually rising its economy.

Contrastingly, the challenge may occur with the supply constraints of certain pure metals that may include outgrowth of demands. Yes! the requirement is so huge that the supply may outrun the demands posed by the electric vehicle market. Experts are looking into these crucial numbers to ensure that there is a balance in the economy and production without causing a major threat due to the shift over.

4. What can metalworking manufacturers expect from the E-mobility market on the road ahead?

The sales of Global passengers’ vehicle is expected to reach a more than 50% in 2040, according to Bloomberg NEF. In the next couple of years, the European automobile market is expected to change by a convenient costs of Electric vehicle availability for consumers. Other market players like India and Japan are also expected to have an increase in the number of electric vehicle consumers on road.  Consequently, this may open opportunities among the global market players to record heights of metal and metal parts production.

Apart from this, several data predicts that the maximum contribution of Electric vehicle sales will be done by the European and Chinese markets due to their regulation policies, credit systems and environmental conditions. As the giants of pure metal production, these markets are expected to make a remarkable revolution in the history of metalworking based on the e-mobility market.

On the other hand, the United States and South Korea exhibit similar market projections for EV adoption. The unavailability of charging facilities in the US is expected to slow down the adoption when compared to Europe and China. South Korea projects a similarity yet it is expected to rise with the increase of demands from its auto-makers to adopt to the electromobility technology. This marks the slowdown in the shift but not a dip in the graph of the metal market. The steady increase in these markets will eventually cause a huge production change in the metalworking market.

Looking next, although Japan makes numerous innovations in the electromobility unit, the homeland manufacturing giants are yet to upgrade to the electrification of their automotive products. This shows that Japan might be quite behind in Europe and China in the growth projection.

Subsequently, announcement of electric vehicle production by giant manufacturers like Tesla, Porsche, Ford, Lamborghini, General motors, Toyota, Daimler, Nissan, BMW Group, Honda, Volvo, Volkswagen group and more have boosted the hopes of both the electric vehicles market and the metalworking market.

5. Conclusion

Several innovations and electrification of the automotive industry has marked the advent Electric vehicles as the upcoming trend of common transport. The mandatory shift requirement to low-carbon transportation have now pushed government to invite auto-makers to electrify their products, rising new demands in the metalworking industry.  Revision of policies are also fiercely underway to make several changes that are eco-friendly and to reverse the damages caused to the environment.  In parallel, the automakers also find the production of electric vehicles less complex and increased demand for battery powered vehicles in projection of the future. Therefore, metalworking manufacturers must be ready for the adoption with a huge demand for their products in the near future.

The tangible results of this revolution have also surged the confidence of manufacturers to make a huge-investments on electromobility. The establishment of own battery production facilities and partnership agenda of the big players in the automotive industry have made it more clear about the need for additional part production and mining reserves to meet the upcoming market demands. In addition, the manufacturers are also making huge investments in establishing and renovating production plants that include part production of metals.

6. References

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