Navigating the complex EV battery supply chain

Growing global adoption of electric vehicles (EVs) relies on a complex and evolving lithium-ion (Li-ion) battery supply chain, covering raw mineral extraction, battery component manufacturing and cell assembly. Each step of this elaborate process presents unique challenges and opportunities. 

One of the major supply chain challenges is ensuring sufficient mineral availability to meet the rising EV demand and evolving battery requirements. Early 21st-century consumer EVs were very compact, which helped maximize the limited range that most Li-ion battery packs of the time could provide. For example, the 2016 Chevrolet Spark EV was only 3.7 m (147 in) long with a driving range of 132 km (82 miles). However, vehicle size, range and performance expectations have increased in the last decade, requiring larger battery packs with favorable mineral combinations and higher cell counts per vehicle.

Additionally, the industry is confronted with the need to develop sustainable recycling methods as early EVs and their Li-ion batteries approach end-of-life. These efforts are essential to minimize waste and reduce the strain on virgin resources and the environments from which they are extracted.

EV adoption has skyrocketed globally over the last decade, with EV sales reaching a record 10.5 million in 2023, including both full battery and plug-in hybrid EVs. There is no sign of a slow-down, with projections predicting a compounded annual EV growth rate of 32% through 2030. These figures highlight the pressing need for robust and sustainable battery supply chain solutions.

Like most batteries, EV batteries are comprised of rare earth minerals, containing varying amounts of lithium, cobalt, nickel and graphite. Many of these materials can be reused and recycled in the circular economy, as opposed to fuel for internal combustion engine (ICE) vehicles, which relies on the continuous extraction and burning of fossil fuels. 

Lithium and other rare earth minerals pass through many stages and processes as they make the journey from the earth to wholesale and retail markets in battery packs. These steps include mining, refining, battery manufacturing, assembly and shipping. 

The price of lithium batteries reflects all intermediary steps and larger EV batteries can be quite expensive. For example, a replacement Tesla Model S battery pack costs between USD $8,000 and $10,000 in 2024. 

The EV battery journey begins in mineral-rich regions where essential rare earth minerals are mined. Most of these materials are extracted as mineral-rich ore, refined, processed, leached and purified. 

However, mining operations can contribute to deforestation, habitat loss and water pollution unless responsible environmental protection measures are implemented. Furthermore, the concentration of rare earth minerals in limited regions raises concerns about geopolitical vulnerability and potential supply chain disruptions, requiring industry stakeholders to keep a collective watch on the market and work together to mitigate potential impacts ahead of time. 

The industry is responding to these challenges through mineral diversification efforts, more environmentally friendly methods of mining and advancement in battery mineral recycling capabilities. These actions are expected to reduce reliance on geopolitically sensitive materials, preserve ecosystems near mines and protect water resources. 

Midstream processes require transforming raw materials into battery-grade composites. These steps include processing lithium into compounds like hydroxide, carbonate and salts, essential for producing battery electrode coatings and the electrolyte layer between a battery cell’s cathode and anode. 

A battery’s cathode significantly influences cell performance. Most EV cathodes are combinations of cobalt and nickel alloys, but there is ongoing experimentation to use safer, more efficient and diverse combinations of metals. 

Li-ion anodes typically consist of copper foil coated with graphite, providing a host structure for lithium ions during charging and discharging. This component relies on specialized graphite, ground to precise sizes and applied to the copper surface. 

These midstream procedures are conducted at a significant scale because most EV batteries contain thousands of individual cells. Ensuring material purity and manufacturing quality is critical for safe and efficient batteries, requiring sophisticated process instrumentation and analyzers to monitor and control the production process. 

Following manufacturing, the components are combined into cells, typically in cylindrical shapes for EVs. These cells are then assembled into large battery packs to provide acceptable power to a vehicle over long ranges. 

Providing batteries able to power EVs over a long range is a key requirement for the increasing viability of EVs in both consumer and commercial markets. Drivers are used to filling up ICE vehicles in just minutes after a few hundred miles of driving, using an abundant network of gas stations. By contrast, EV charging stations are few and far between and charging an EV battery takes hours at most terminals. 

To combat these drawbacks, the charging infrastructure must continue expanding, with a focus on high-power-delivery fast charging. Increasingly capable batteries with higher energy storage capacity help mitigate some feasibility concerns, especially in consumer and commercial markets where vehicles are often parked for extended periods, providing ample charging opportunities. 

Hydrogen fuel cell development is another technical option for addressing the recharging duration issue, but fueling infrastructure is critically lacking in most regions, rendering hydrogen-powered vehicles unviable in most markets for the time being. 

Li-ion batteries can be dangerous because of the energy stored within them as well as highly reactive raw materials and chemicals used, making them perilously prone to combustion if exposed to sparks, severely deformed or poorly constructed. Furthermore, decomposition of the lithium-based electrolyte can release flammable gases like ethylene, methane and hydrogen into the air. 

Thermal runaway, which can occur if a battery becomes too hot due to damage or improper charging, is a serious concern for EV batteries. In the event this occurs, growing heat vaporizes the electrolyte, compromising the cell casing and releasing flammable gases. Overcharging can cause metallic lithium to form inside the cell, which can cause internal short circuits and react with ambient humidity. Once this reaction begins, it is self-sustaining, therefore disconnecting power may not stop it. Unfortunately, thermal runaway is difficult to detect until a fire breaks out, highlighting the importance of high-quality cell manufacturing.

Recycling has become a critical aspect in the EV battery supply chain recently as the industry grapples with a rapid increase in battery component waste from end-of-life EVs. As EV adoption grows, so does the need for efficient and sustainable recycling methods to recover valuable metals, minimize environmental impact and supplement mining for new EV battery production.

EV batteries can be recycled in similar ways to smaller Li-ion batteries via pyrometallurgy and hydrometallurgy. However, their large size, weight and complexity multiply the challenges of effective mineral recovery. Various recycling facilities approach the task differently. Some choose to manually disassemble EV battery packs using teams of skilled workers, while others simply shred entire batteries while submerged in inert liquid to restrict oxygen and reduce the risk of combustion. 

The efficacy of recycling EV batteries is improving rapidly despite the challenges, with innovations like robotic disassembly helping scale the practice. Largescale battery recycling is an increasingly important area of research because the number of batteries that will require future recycling is growing commensurately as record numbers of EVs take to the road and as battery-based energy storage systems proliferate. 

Meeting the rapidly growing demand for EV batteries requires a stable supply chain, which spans mining, manufacturing, assembly and recycling processes. Additionally, the industry must ensure a seamless flow of components and materials across geographically dispersed regions to maintain efficient battery pack production. 

The transition to electric mobility presents challenges, but it is a crucial part of global efforts to reduce carbon emissions and limit greenhouse gases in the atmosphere. Addressing the EV supply chain challenges sustainably requires implementing responsible raw material sourcing practices, mitigating the environmental impact of mining, stringently controlling quality during manufacturing and assembly and continuing to invest in battery recycling technologies.