The UK needs China's batteries to develop a domestic EV manufacturing industry and will not impose restrictions on imports of such products, the UK's Business and Trade Secretary Kemi Badenoch told Bloomberg on Monday.
Badenoch was commenting on the news the UK government shared today that BMW is set to announce a multi-million-pound investment in its Oxford MINI plant to make electric Minis.
Last week, another major auto manufacturer, Stellantis, announced the start of EV production after a $125 million (£100 million) investment to make the site in Ellesmere Port in the UK its first globally dedicated solely to producing EVs.
Asked if the UK is too dependent on China for EV batteries, Badenoch told Bloomberg,
"At the moment, China is leading on this technology, so we wouldn't be able to get to where we want to get to on net zero by completely stopping or banning Chinese products."
"You can't exclude Chinese-made products from the battery ecosystem," the business and trade secretary said.
China continues to dominate the market for critical minerals for batteries, although the U.S., the UK, and the EU have started to look to diversify the supply chain.
Bank UBS expects China to end up controlling nearly one-third of the global lithium supply by 2025. Mines controlled by Beijing, not only in China but also in Africa, will see their total lithium output jump more than threefold in just three years-from 194,000 tons in 2022 to 705,000 tons by 2025, UBS said in a note earlier this year, carried by Bloomberg.
This surge in supply would raise the Chinese share of global lithium supply to 32% in 2025, up from 24% in 2022, the bank said.
A report from Darton Commodities, quoted by the Financial Times, expects that China's cobalt share is set to hit 50% of global cobalt output in the next two years. China's CMOC Group is currently the second biggest producer of cobalt in the Democratic Republic of Congo, the country providing 75% of global supply now.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com More